Comprehensive Annual Financial Report omprehensive Annual Financial Report
C
for the Fiscal Year Ended June 30, 2018
for the Fiscal Year Ended June 30, 2018
City of Winston-Salem, North Carolina
City of Winston-Salem, North Carolina
Illuminated by changing multi-colored
lights at night, this wooden bridge is part of
the 1.7-mile Long Branch Trail that connects
Wake Forest Innovation Quarter with the
Salem Creek Greenway. Opened in
April 2018, it is actively used during the day
by pedestrians, cyclists and scooter riders.
2018 AN NUAL R E P O R T
Comprehensive Annual Financial Report for the
Fiscal Year Ended June 30, 2018
City of Winston-Salem, North Carolina
The Comprehensive Annual Financial Report is
prepared by Financial Management Services.
W I N S T O N S AL E M , N O R T H C AR O L I N A
credits
CREATIVE DIRECTION
AND COP Y WRITING
Rachel Barron, Next Level Communications
DESIGN AND ART DIRECTION
LinTaylor Marketing Group, Inc.
PRINTING
Keiger Graphic Communications
PHOTOGRAPHY
Girl on the Roof, Inc.
Doug Rice Photography
Winston-Salem DASH
Novant Health
Wake Forest Baptist Health
Rachel Barron
The City of Winston-Salem
Marketing Department
2018 AN NUAL R E P O R T
credits City of Winston-Salem, North Carolina
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Fiscal Year Ended June 30, 2018
Introductory Section Page
Letter of Transmittal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2
Local Economy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4
Community Pro le . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
GFOA Certi cate of Achievement. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
Organizational Chart . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
City O cials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35
Financial Section Exhibit Page
Independent Auditor’s Report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36
Management’s Discussion & Analysis . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38
Basic Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47
Government-wide Financial Statements
– Statement of Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1 . . . . . . 48
– Statement of Activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .2 . . . . . . 50
Fund Financial Statements
– Balance Sheet – Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3. . . . . . . 52
– Reconciliation of the Governmental Funds Balance Sheet to the Statement of Net Position. . . . . . . . . . . . . . . . .3.1. . . . . . . 53
– Statement of Revenues, Expenditures, and Changes in Fund Balances – Governmental Funds. . . . . . . . . . . . . . . . . . . . . 4 . . . . . . . 54
– Reconciliation of the Statement of Revenues, Expenditures, and Changes
in Fund Balances of Governmental Funds to the Statement of Activities. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .4.1. . . . . . . 55
– Statement of Revenues, Expenditures, and Changes in Fund Balance –Budget and Actual – General Fund . . . . . . . . .5. . . . . . . 56
– Statement of Net Position – Proprietary Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .6. . . . . . . 61
– Statement of Revenues, Expenses, and Changes in Fund Net Position – Proprietary Funds . . . . . . . . . . . . . . . . . .7. . . . . . . 63
– Statement of Cash Flows – Proprietary Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .8. . . . . . . 64
– Statement of Fiduciary Net Position – Fiduciary Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .9. . . . . . . 66
– Statement of Changes in Fiduciary Net Position – Fiduciary Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10. . . . . . . 67
Notes to the Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . 68
Required Supplementary Information. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . 115
– Schedule of Changes in Net Pension Liability and Related Ratios,
Winston-Salem Police O cers’ Retirement System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 . . . . . . .117
– Schedule of Contributions, Winston-Salem Police O cers’ Retirement System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 . . . . . . .118
– Schedule of Investment Returns, Winston-Salem Police O cers’ Retirement System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 . . . . . . .120
– Schedule of Changes in Net Pension Liability and Related Ratios,
Winston-Salem Police O cers’ Separation Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 . . . . . . .121
– Schedule of Contributions, Winston-Salem Police O cers’ Separation Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 . . . . . . .122
– Schedule of Investment Returns, Winston-Salem Police O cers’ Separation Allowance . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 . . . . . . .124
– Schedule of Changes in Net OPEB Liability and Related Ratios, Post-employment Bene ts. . . . . . . . . . . . . . . . . . . . . . . . . 17 . . . . . . .125
– Schedule of Contributions, Post-employment Bene ts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 . . . . . . .126
– Schedule of Investment Returns, Post-employment Bene ts. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 . . . . . . .128
– City of Winston-Salem’s Proportionate Share of Net Pension Liability (Asset)
Local Government Employees’ Retirement System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 . . . . . . .129
– City of Winston-Salem’s Contributions
Local Government Employees’ Retirement System . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 . . . . . . .130
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Financial Section continued Exhibit Page
Combining and Individual Fund Statements and Schedules:
Major Funds:
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual
– Debt Service Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 . . . . .135
– Capital Projects Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 . . . . .136
Enterprise Funds – Schedule of Revenues, Expenditures, and Transfers – Budget (non-GAAP Basis) and Actual
– Water and Sewer Utility Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24 . . . . .137
– Solid Waste Disposal Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25 . . . . .138
– Transit Authority Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26 . . . . .139
Nonmajor Governmental Funds:
– Combining Balance Sheet – Nonmajor Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27 . . . . .142
– Combining Statement of Revenues, Expenditures, and Changes in Fund Balances –
Nonmajor Governmental Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28 . . . . .144
Schedule of Revenues, Expenditures, and Changes in Fund Balance – Budget and Actual
– Community Development Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29 . . . . .146
– Grants Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30 . . . . .147
– Economic and Housing Development Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31 . . . . .148
– Gasoline Tax Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32 . . . . .149
– Occupancy Tax Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33 . . . . .150
– Emergency Telephone System Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34 . . . . .151
– Downtown Winston-Salem Business Improvement District Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 . . . . .152
Nonmajor Enterprise Funds:
– Combining Statement of Net Position – Nonmajor Enterprise Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 36 . . . . .154
– Combining Statement of Revenues, Expenses, and Changes in Net Position –
Nonmajor Enterprise Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37 . . . . .155
– Combining Statement of Cash Flows – Nonmajor Enterprise Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 38 . . . . .156
Schedule of Revenues, Expenditures, and Transfers – Budget (Non-GAAP Basis) and Actual
– Parking Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 39 . . . . .158
– Stormwater Management Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 40 . . . . .159
– Public Assembly Facilities Management Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 41 . . . . .160
Internal Service Funds:
– Combining Statement of Net Position – Internal Service Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 42 . . . . .162
– Combining Statement of Revenues, Expenses and Changes in Net Position – Internal Service Funds . . . . . . . . . . . . . . . . . . 43 . . . . .164
– Combining Statement of Cash Flows – Internal Service Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44 . . . . .166
Schedule of Revenues, Expenditures and Transfers – Budget (Non-GAAP Basis) and Actual
– Central Warehouse Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 45 . . . . .170
– Fleet Services Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 46 . . . . .171
– Information Services Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 47 . . . . .172
– Workers’ Compensation Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 48 . . . . .173
– Health Bene ts Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49 . . . . .174
– Dental and Flex Bene ts Fund . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50 . . . . .175
– Employee Bene ts Fund. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 51 . . . . .176
Fiduciary Funds:
– Combining Statement of Fiduciary Net Position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 52 . . . . .178
– Combining Statement of Changes in Fiduciary Net Position. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 . . . . .179
Schedule of General Obligation Bonded Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54 . . . . .182
2018 AN NUAL R E P O R T
Statistical Section Table Page
Financial Trends:
– Net Position by Component . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 . . . . . . .186
– Changes in Net Position. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2 . . . . . . .188
– General Revenues and Total Changes in Net Position. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3 . . . . . . .192
– Program Revenues by Function/Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4 . . . . . . .194
– Fund Balances, Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5 . . . . . . .196
– Changes in Fund Balances, Governmental Funds . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6 . . . . . . .198
Revenue Capacity:
– Tax Revenues by Source, Governmental Funds. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 . . . . . . .202
– Taxable Property Assessed Value . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8 . . . . . . .203
– Property Tax Rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9 . . . . . . .204
– Principal Property Tax Payers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10 . . . . . . .205
– Property Tax Levies and Collections . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11 . . . . . . .206
– Analysis of Current Tax Levy. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12 . . . . . . .207
– Schedule of Ad Valorem Taxes Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13 . . . . . . .209
Debt Capacity:
– Ratios of Outstanding Debt by Type . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14 . . . . . . .210
– Ratios of General Bonded Debt Outstanding . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15 . . . . . . .212
– Legal Debt Margin. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16 . . . . . . .213
– Direct and Overlapping Governmental Activities Debt. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17 . . . . . . .215
– Pledged – Revenue Coverage . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18 . . . . . . .216
Demographic and Economic Information:
– Demographic and Economic Statistics . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19 . . . . . . .218
– Principal Employers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20 . . . . . . .219
Operating Information:
– Full-time-Equivalent City Government Employees by Function/Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21 . . . . . . .220
– Operating Indicators by Function/Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22 . . . . . . .222
– Capital Assets Statistics by Function/Program . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23 . . . . . . .226
Federal and State Grants Section Page
– Independent Auditor’s Report on Internal Control over Financial Reporting and on
Compliance and Other Matters Based on an Audit of Financial Statements Performed
in Accordance with Government Auditing Standards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .230
– Independent Auditor’s Report for Each Major Federal Program and on Internal Control
over Compliance with OMB Uniform Guidance and the State Single Audit Implementation Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .232
– Independent Auditor’s Report for Each Major State Program on Internal Control
over Compliance in Accordance with Applicable Sections of OMB Uniform Guidance
and the State Single Audit Implementation Act. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .234
– Schedule of Findings and Questioned Costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .236
– Summary Schedule of Prior Year Audit Findings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .239
– Schedule of Expenditures of Federal and State Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .240
– Notes to Schedule of Expenditures of Federal and State Awards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .245
Certain pages in this report are intentionally blank.
W I N S T O N S AL E M , N O R T H C AR O L I N A 1
Letter of Transmittal
October 31, 2018
To the Honorable Mayor and Members of City Council
and Citizens of the City of Winston-Salem
Ever since the merger of Winston and Salem in 1913, the twin City has prospered through the cooperation of its public and private
institutions. This was true in the years following the incorporation of Winston-Salem, and it remains true today. The enduring
veracity of our City motto was underscored again during the past year, as our community continues to see the tangible benefits
of the past decade of efforts by City government and private institutions to diversify our economy, increase our tax base, bring
new jobs to our City, and breathe new life into our downtown.
Financial Report
It is our pleasure to submit the Comprehensive Annual Financial Report for the City of Winston-Salem, North Carolina for the
fiscal year ended June 30, 2018. Management of the City of Winston-Salem, North Carolina, is responsible for the integrity and
objectivity of financial statements and other representations contained in this annual report. The City’s Comprehensive Annual
Financial Report, prepared in accordance with generally accepted accounting principles for units of local government, consists of
management’s representations concerning the financial position and results of operations for the fiscal year ended June 30, 2018.
North Carolina general statutes require each unit of local government to publish within four months after the close of the fiscal
year a complete set of financial statements presented in conformity with generally accepted accounting principles (GAAP) and
audited in accordance with generally accepted auditing standards by a firm of certified public accountants. The City engaged
Dixon Hughes Goodman LLP, independent auditors, to perform an audit of the City’s reported financial position and results of
operations contained in the government-wide and fund financial statements and notes to the financial statements. Their audit
consists of an objective outside review in order to provide reasonable rather than absolute assurance that the financial statements
are free from material misstatements. Working with the City’s professional financial and auditing staff, they reviewed and made
appropriate tests of data included in the financial statements, and evaluated the overall financial statement presentation. The
independent auditor concluded, based upon the audit, that there was a reasonable basis for rendering an unmodified opinion that
the financial statements of the City of Winston-Salem for the fiscal year ended June 30, 2018, are fairly presented in conformity
with GAAP. The report of independent auditors is presented as the first component of the financial section of this report.
Management assumes full responsibility for the completeness and reliability of the information contained in this report, based
upon a comprehensive framework of internal control that it has established for this purpose. Because the cost of internal control
should not exceed anticipated benefits, the objective is to provide reasonable, rather than absolute, assurance that the financial
statements are free of any material misstatements.
The independent audit of the financial statements of the City of Winston-Salem was part of a broader, federally mandated “Single
Audit” designed to meet the special needs of federal grantor agencies. The standards governing Single Audit engagements require
the independent auditor to report not only on the fair presentation of the financial statements, but also on the City’s internal
controls and compliance with legal requirements, with emphasis on administration of federal grants.
Assuring legal compliance requires an accounting system that contains a variety of distinctly different fiscal and accounting
entities. Formal budgetary accounting is employed for all funds for management planning and control required by North Carolina
General Statutes. Budgets are legally enacted by passage of Annual Budget and Project Budget Ordinances and formally amended
as required. The City Manager is authorized to transfer budget amounts within functions, but changes between functions and total
budgets of any fund require approval by the City Council.
The City’s financial statements also present the financial position and results of operations of two nonprofit corporations, North
Carolina Municipal Leasing Corporation and Risk Acceptance Management Corporation, which provide services under contract
to the City. Although legally separate they are included because they have significant financial relationships with the City.
Additional information on these entities can be found in the notes to the financial statements.
2 2018 AN NUAL R E P O R T
Honorable Mayor and
Members of the City Council
City of Winston-Salem, North Carolina
Page 2
GAAP requires that management provide a narrative introduction, overview, and analysis to accompany the basic financial
statements in the form of Management’s Discussion and Analysis (MD&A). This letter of transmittal is designed to complement
MD&A and should be read in conjunction with it. The City’s MD&A can be found immediately following the report of the
independent auditors.
Included in the Comprehensive Annual Financial Report is information about the City as a social and economic unit as well as
its governmental structure that is intended to enable the reader to assess the City’s economic foundation, quality of life, and
financial condition. The information complements MD&A, which highlights the fiscal year.
Long-term Financial Planning
The Comprehensive Annual Financial Report reflects the sound fiscal policies our elected officials have established to achieve
their annual priorities for programs, services and capital improvements. These policies have resulted in the City’s strong
financial position which is demonstrated by the highest credit rating attainable in national bond markets. Growth of the City’s
economic base as well as realistic long-range planning, productive management of revenue and cash resources, expansion of
self-supporting enterprises within government, and prudent use of debt continue to produce favorable operating results.
Unassigned general fund balance represents 11.95% of the budgeted expenditures while total general fund was 24.29%.
The City annually adopts a six-year Capital Plan for the scheduling and appropriation of funds for major projects that represent
significant contributions to the City’s overall inventory of physical assets. City Council approval of the Capital Plan commits
the City to the first year of the capital projects with conditional approval for those projects listed in the five future planning years.
The six-year Capital Plan, from fiscal year 2019 through fiscal year 2024 includes capital appropriations totaling $388.5 million
and includes projects funded by general fund resources, general obligation bonds, utility revenue bonds, North Carolina Clean
Water State Revolving Loan Funds, special obligation bonds, North Carolina Municipal Leasing Corporation, state and federal
grants, gasoline taxes, and capital reserves.
Awards and Acknowledgements
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement
for Excellence in Financial Reporting to the City of Winston-Salem for its Comprehensive Annual Financial Report for the
fiscal year ended June 30, 2017. This was the 32nd consecutive year that the government has achieved this prestigious award.
In order to be awarded a Certificate of Achievement, a government must publish an easily readable and efficiently organized
Comprehensive Annual Financial Report. This report must satisfy both generally accepted accounting principles and applicable
legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current Comprehensive Annual Financial
Report continues to meet the Certificate of Achievement Program’s requirements, and we are submitting it to the GFOA to
determine its eligibility for another certificate.
Deserving special commendation are skilled, talented, and dedicated employees – the work force of the City of Winston-Salem.
Acknowledgement and appreciation are expressed for their contributions to a successful year. We also express our sincere
appreciation to the Mayor and City Council for leadership, guidance, and establishment of policies for managing financial
operations in a sound and progressive manner.
Respectfully submitted,
Lee D. Garrity Lisa M. Saunders
City Manager Chief Financial Officer
W I N S T O N S AL E M , N O R T H C AR O L I N A 3
Winston-Salem is a city rich in
business history, and this
proud tradition continues as
government, economic
development and university
leaders are taking the old and
making it new again.
4 2018 AN NUAL R E P O R T
ormer downtown tobacco factories and warehouses once owned by homegrown
R.J. Reynolds Tobacco Company have been transformed into Wake Forest Innovation
FQuarter, a hub of research labs, medical school classrooms, upscale loft apartments, and
bustling restaurants and breweries. More than 170 companies, including a number of start-up
businesses and Inmar, a rapidly growing high-tech logistics company, now occupy Innovation
Quarter. Over 3,700 workers and 1,800 degree-seeking students make for an energetic atmosphere
during the work week.
LOCAL ECONOMY 2018
A few blocks away, the 21-story former GMAC Insurance ARTS AND INNOVATION
building is also experiencing a rebirth as an entrepreneurial
center under the leadership of Don Flow, head of the As a modern City of Arts and Innovation, Winston-Salem is
Flow Automotive Group. Along with moving his corporate beginning to fully realize the positive economic impact of
headquarters to the building, Flow has teamed with Grubb the arts. A study by Americans for the Arts, a national
Properties, a Charlotte-based developer, to transform the nonpro t organization, estimated that full-time jobs in the
building into a mixed-use complex. About 35,000 square nonpro t arts and culture sector in Forsyth County rose
feet will be reserved for Winston Starts, a new business 15 percent, to 5,559, between 2010 and 2015. The total
accelerator organization. On the south side of the building, economic impact of both sectors doubled in that period,
Grubb will develop 240 residential units and storefronts at from $76.6 million to $156.8 million.
an estimated investment of $48 million. The Winston- One of Winston-Salem’s most prominent arts events is the
Salem City Council has approved an incentive deal to biennial National Black Theater Festival. With the
provide Grubb with $1.65 million over 10 years for the project. successful 2017 festival and the completion of an $18.5
Just north of downtown, Whitaker Park, a former Reynolds million City-funded renovation to the Benton Convention
manufacturing complex of 1.7 million square feet, will soon be Center, tourism spending in Forsyth County reached
the new home of Cook Medical. With the move, expected to another record high of $898.4 million in the 2017-2018 scal
take place in 2020 or 2021, the family-owned developer and year. Visitors to Forsyth County generated an estimated
maker of medical devices will more than quadruple — to $69.8 million in local and state tax revenues in 2017, up
850,000 square feet — its current manufacturing space in 6 percent from 2016. There are 7,200 jobs in Forsyth
the northern part of the City. The complex is owned by the considered to be associated with travel and tourism, a
Whitaker Park Authority, a non-pro t corporation chaired 4.1 percent increase from 2016.
by Flow and created by Winston-Salem Business, Inc., the
Winston-Salem Alliance and Wake Forest University. The OTHER ECONOMIC MEASURES
entire complex has the potential to be the next mixed-use In other economic measures, the Winston-Salem housing
economic engine for the City. The City Council has approved market continued to thrive, with home prices in the
about $2.5 million in economic development assistance for Winston-Salem metro area up 4.9 percent in the rst six
Cook Medical to assist with moving costs. Cook Medical is months of 2018 compared with the same period in 2017,
investing about $55 million at the proposed site. according to Michael S. Clapp & Associates, a local real
Another key component of the renewal is taking place with estate research rm. The average sale price of a house in
the upgrade of downtown’s main artery. While Winston- Forsyth County was $186,316, an increase of 7.1 percent
Salem residents have faced the closure of a major section of from 2017. The apartment market continues to thrive as
Business 40 with some trepidation, the City Council and the well. In Forsyth County, there are 23,035 apartment units
public were delighted to learn that the originally projected with a vacancy rate of 4.8 percent, according to Real Data, a
two-year disruption may be shortened to as few as 14 months. company that surveys market-rate apartments in
Southeastern metro cities. The average rent is $827. The
Advance preparations designed to help tra c ow during strongest submarket in Forsyth County is downtown, with
the closure have included the completion of Research Parkway, vacancy at 4.5 percent and average rent at $962.
which connects Innovation Quarter to U.S. 52, and the
widening of several key streets and interchanges in the The unemployment rate in Forsyth County has continued to
downtown area. The Winston-Salem Transit Authority will decline, according to the U.S. Department of Labor. By
be bee ng up expanded service on some routes. July 2018, the unemployment rate stood at only 4.2 percent,
down from 4.3 percent in 2017 and 5.1 percent two years ago.
W I N S T O N S AL E M , N O R T H C AR O L I N A 5
Local entrepreneurs and innovators meet for VENTURE CAFE, which
o ers weekly presentations and networking opportunities.
TECHNOLOGY AND INNOVATION
Encompassing 337 acres and 1.9 million square feet of Also on the Innovation Quarter campus is The Center
o ce, laboratory and classroom space, Wake Forest for Design Innovation, a joint e ort by Forsyth
Innovation Quarter is one of the fastest-growing urban Technical Community College, the UNC School of the
innovation districts in the United States. Medical and Arts and Winston-Salem State University. The
biomedical research organizations thriving in Innovation 25,000-square-foot building includes a 60-by-60-foot-
Quarter include the Wake Forest Institute for Regenerative space known as “the Cube,” one of the largest dedicated
Medicine (WFIRM), whose researchers were the rst in spaces for motion-capture research in the Southeast.
the world to engineer laboratory-grown organs that Other organizations in the CDI building are Flywheel, a
were successfully implanted into humans. Today, the team 24/7 co-working environment with spaces available for
is working to engineer more than 30 di erent replacement lease on an as-needed or temporary basis and the
tissues and organs and to develop healing cell therapies. Center for the Creative Economy, which supports a
About 20 academic departments of Wake Forest burgeoning creative sector that includes design,
Baptist Medical Center, Forsyth Technical Community architecture, advertising, interactive gaming, and more.
College, and Winston-Salem State University are Much of Innovation Quarter’s redevelopment has been
located there. In addition, Wake Forest University has the result of more than $800 million of investments,
established Wake Downtown, an undergraduate much of it from Wexford Science & Technology, LLC, a
satellite campus o ering bachelor of science degrees in BioMed Realty Company. The City has been a major
engineering, biochemistry, molecular biology, mechanical player in supporting Innovation Quarter, along with
chemistry and drug discovery. In all, about 1,800 degree- Forsyth County and the State of North Carolina. Much of
seeking students are attending programs in the the investment has leveraged historic tax credits
technology park. approved by the National Park Service.
With the redevelopment of Bailey Power Plant, the In summer 2018, Wexford announced a new minority-
former power-generating station for the Reynolds and women-owned business initiative to be located in
factories, the renovation and repurposing of the existing the Innovation Quarter and run by an independent
buildings in Innovation Quarter is complete. Bailey Power local non-pro t or government agency. The aim of the
Plant, with its iconic smokestacks and more than 111,000 initiative will be to encourage, support and accelerate
square feet of space, is now home to Alma Mexicana, a local small businesses and start-ups founded by women
Tex-Mex restaurant; Incendiary Brewing, Winston-Salem’s and minorities.
seventh brewery; and Venture Café, which hosts
hundreds of local entrepreneurs and innovators for Nearby, MIXXER Studios provides a state-of-the-art
“makerspace” for artisans and craftspeople. MIXXER
Thursday night workshops and opportunities to mix,
mingle and learn from one another. Front Street Capital, members have access to equipment for working with
traditional materials like wood, metal and textiles, as well
a private equity real estate company in Winston-Salem,
has said it will redevelop other portions of the building as more modern tech like laser cutters, 3D printers, CNC
machinery, and computers with art design software.
into o ce and retail space.
6 2018 AN NUAL R E P O R T
INNOVATION QUARTER now
includes Wake Downtown, a satellite
campus of Wake Forest University that
houses undergraduate biomedical and
engineering programs.
W I N S T O N S AL E M , N O R T H C AR O L I N A 7
Winston-Salem is the headquarters
to two of North Carolina’s
largest regional health systems —
Novant Health, Inc. (Novant) and
Wake Forest Baptist Medical Center
(Wake Forest Baptist). More than
22,000 people work in health care in
Forsyth County, making it the county’s
largest employment sector.
8 2018 AN NUAL R E P O R T
NOVANT HEALTH FORSYTH
MEDICAL CENTER
WAKE FOREST
BAPTIST HEALTH
HEALTH CARE
Novant Health is an integrated health care system based in With more than 12,000 employees, Wake Forest Baptist Medical
Winston-Salem with a footprint that spans four states. Its network Center is Winston-Salem and Forsyth County’s largest employer.
consists of 14 medical centers, over 580 clinic locations, and more The fully integrated academic medical system is comprised of
than 1,500 physicians in North Carolina, Virginia, South Carolina Wake Forest Baptist Health, Wake Forest School of Medicine,
and Georgia. Wake Forest Innovations, and Wake Forest Innovation Quarter.
As a nationally recognized academic Medical Center, it includes a
Novant is one of the rst health care systems in the nation to
receive the Centers for Medicare and Medicaid Services (CMS) medical sta of more than 1,300 physicians with expertise in over
Health Equity Award, which recognizes a commitment to health 100 specialties; 3,000 registered nurses; and 625 residents and
equity among di erent races, ethnicities, genders and those living fellows; and the nationally ranked Brenner Children’s Hospital,
in rural areas. It has a major impact in its communities by delivering the region’s only pediatric hospital. Its Comprehensive Cancer
over $794 million in community bene ts and has been named Center is a leader in the ght against cancer — it is one of only 47 in the
among the top places in the nation to work in health care. The nation designated as comprehensive by the National Cancer Institute.
health system is recognized for the quality and safety of its patient The Medical Center provides 1,029 acute care beds, as well as
care by the Joint Commission, the nation’s most respected outpatient services, physician practices and clinics, diagnostic
standards-setting and accrediting body for health care. centers, emergency and urgent care centers, community health
Novant Health’s Forsyth Medical Center (FMC) is a 927-bed, not- and information locations, and a division that brings innovative
for-pro t hospital in Winston-Salem o ering a full continuum of discoveries in technology, products and services to patient
emergency, medical, surgical, rehabilitative and behavioral health bedsides. It is the region’s only Level I Trauma Center and was the
services. FMC is fully accredited by the Joint Commission and has state’s rst Level 1 Pediatric Trauma Center. Other locations that are
earned numerous national rankings in specialties including cardiac part of the Wake Forest Baptist Health system include Wake Forest
surgery, oncology, gynecology, heart disease and stroke, knee and Baptist Health-Lexington Medical Center, Wake Forest Baptist
hip joint replacement, and excellence in nursing care. Health-Davie Medical Center and Wake Forest Baptist Health-
Wilkes Medical Center.
Centers of excellence at FMC include Novant Health Rehab-
ilitation, the Maya Angelou Women’s Health & Wellness Center, The institution plays a key role in the community by delivering
the Heart & Vascular Institute, the Derrick L. Davis Cancer Center, more than $370 million in charitable care and other community
Stroke & Neurosciences Center, Orthopedic Center and bene ts. The hospital holds the coveted Gold Seal of Approval ™
Behavioral Health. The Maya Angelou Center operates the largest from the Joint Commission.
birthing center in the region and assists with more than 6,000 Wake Forest Baptist’s medical and surgical programs continually
births each year. rank among the best in the country. It has been recognized as one
of the Top 50 of America’s Best Hospitals by U.S. News & World Report
Novant’s Medical Park Hospital is a 22-bed, not-for-pro t hospital
that specializes in elective, outpatient and short-stay surgeries. As for the 26th consecutive year, and Brenner Children’s Hospital ranks
one of four Novant facilities providing surgical care, Medical Park among the best children’s hospitals. Wake Forest Baptist’s physicians
performs about 12,000 surgeries each year. Novant also operates rank among the top in the country, with 325 included in the Best
four community hospitals in the region: Novant Health Clemmons Doctors in America database.
Medical Center, Novant Health Kernersville Medical Center, The medical school serves approximately 2,000 students, residents
Novant Health Rowan Medical Center, and Novant Health and fellows. It continually ranks among the best medical schools in
Thomasville Medical Center. the country by U.S. News & World Report; its physician assistant
program ranks 9th in the country, while its nurse anesthesia
program is 10th.
W I N S T O N S AL E M , N O R T H C AR O L I N A 9
FINANCIAL SERVICES
BB&T Corporation (BB&T), a Fortune 500 company Salem and employs 2,745 workers here. With $1.9 trillion in
headquartered in Winston-Salem, is a fast growing, highly assets, Wells Fargo has more than 8,500 locations in 38
pro table nancial holding company with 2,100 employees countries and territories.
here. BB&T touts its operating strategy as unique, in that each Piedmont Federal Savings Bank, founded in 1903 in
banking subsidiary is organized as a group of community Winston-Salem, continues to be one of the nation’s soundest
banks with a regional president, allowing for local decision- banks. The bank prides itself on refusing to sell any of its home
making and better customer service. As of June 30, 2018, BB&T loans to other institutions. As a mutual savings bank, Piedmont
Corp was one of the largest U.S. nancial services holding Federal is FDIC-insured, with its customers as its only
companies, with $222.7 billion in assets and market capitalization stakeholders. The bank operates 10 retail branches in Forsyth,
of $39.1 billion. It operates more than 2,100 nancial centers in Wilkes and Watauga counties.
15 states and Washington, D.C., and o ers a full range of
consumer and commercial banking, securities brokerage, Winston-Salem is also home to two of the state’s largest credit
asset management, mortgage and insurance products and unions. Allegacy Federal Credit Union, founded in 1967 to
services. BB&T has paid a cash dividend to shareholders every serve employees of Reynolds Tobacco Co., now has 143,000
year since 1903. owner-members worldwide with over $1.43 billion in assets.
Truliant Federal Credit Union, chartered in 1952 to serve
Wells Fargo & Co. bought Wachovia Corp., founded in 1879 in employees of Western Electric, now has more 200,000
Winston-Salem, in 2008. While Wells Fargo’s headquarters is member-owners throughout the U.S. and assets of more than
located in San Francisco, it maintains a major operation of the $2 billion.
bank’s wealth, brokerage, and retirement division in Winston-
10 2018 AN NUAL R E P O R T
Winston-Salem is the
headquarters of BB&T
Corporation, one of the
largest U.S. nancial services
holding companies, and is
home to a major wealth
management division
of Wells Fargo.
W I N S T O N S AL E M , N O R T H C AR O L I N A 11
MANUFACTURING
Although manufacturing is no longer the largest employment the company reported net sales growth of 4 percent to
sector in Winston-Salem and Forsyth County, it continues to $1.72 billion. Unlike most apparel companies, Hanesbrands
be a major player. Reynolds American, Inc. (RAI) and primarily operates its own manufacturing facilities. It is the
Hanesbrands, both long-time corporate citizens of Winston- only apparel producer to ever be honored by the Great Place
Salem, employ about 3,000 and 2,500 workers, respectively. to Work Institute for its socially responsible workplace practices
in Central America and the Caribbean.
While it continues to maintain a signi cant presence in
Winston-Salem, RAI became an indirect, wholly owned Another manufacturer with a signi cant presence in Winston-
subsidiary of British American Tobacco (BAT) in July 2017. Salem is Rockwell Collins, which employs 1,300 workers
The $54.5 billion transaction completed BAT’s purchase of the inherited from its purchase of B/E Aerospace in April 2017.
57.8 percent of RAI that it did not already own. BAT and RAI Although B/E was not headquartered in Winston-Salem, its
heralded the purchase as creating a “stronger, global tobacco largest manufacturing plant was based here. In a deal expected
and Next Generation products company.” RAI brought to the to close in fall 2018, Rockwell Collins has been sold to
table three of the four best-selling cigarette brands in the U.S. — aerospace company United Technologies Corp.
Newport, Camel and Pall Mall — as well as VUSE digital vapor Other major employers include Deere-Hitachi and Hayward
cigarettes and ZONNIC, a nicotine replacement therapy gum.
Industries, a manufacturer of pool equipment each with 800
HanesBrands, founded in Winston-Salem in 1901, is the employees; WestRock, which makes packaging products and
world’s largest marketer of basic apparel, selling bras, panties, employs 600; and Cook Medical, a manufacturer of medical
shapewear, sheer hosiery, men’s underwear, children’s devices, with 576 workers. Krispy Kreme Doughnuts Inc.,
underwear, socks, t-shirts, sweatshirts, eece and other manufacturer of one of Winston-Salem’s most iconic products,
activewear. The company’s brands include Hanes, Champion, employs 554. The company was acquired for $1.35 billion by
Playtex and Bali. For the quarter ended June 30, 2018, JAB Holding Co. in July 2016.
12 2018 AN NUAL R E P O R T
MAJOR EMPLOYERS
Updated July 2018*
Rank Company Employees* Rank Company Employees* Rank Company Employees*
1 Wake Forest Baptist 14,271 12 Rockwell Collins 1,600 23 Veterans Administration 685
Medical Center
13 Walmart 1,300 24 National General 675
2 Novant Health, Inc. 9,896 Insurance
14 Winston-Salem State 1,073
3 Winston-Salem/Forsyth 8,000 University 25 Aon Consulting 650
County School System SOURCE: WINSTON SALEM CHAMBER OF COMMERCE
15 YMCA of Northwest 1,056 26 Cook Medical 620
4 Wells Fargo 2,890 North Carolina
27 Blue Cross & Blue Shield 600
5 Reynolds American, Inc. 2,500 16 Pepsi/Cognizant 1,050 of NC
6 Hanesbrands 2,300 17 Lowes Food Stores 1,034 28 WestRock 600
7 Wake Forest University 2,251 18 Inmar 912 29 Womble Carlyle 507
(Reynolda Campus) Sandridge & Rice
19 US Airways 900
8 City of Winston-Salem 2,287 30 Truliant Federal Credit 560
20 Flow Automotive 875
9 Forsyth County 2,118 Union
10 BB&T 2,134 21 Deere-Hitachi 800 31 Food Lion 500-999
11 Forsyth Technical 1,505 22 Hayward Industries 800 32 Herbalife 500
Community College
*Employment estimates can vary widely depending on the source. Estimates here are provided
using a variety of sources, including the companies, Winston-Salem Chamber, Forsyth County,
the Winston-Salem Journal, the Triad Business Journal, and Reference USA. If a valid estimate
was not available, the employment range provided by the NC Employment Security
Commission is listed. Some estimates may be outdated, but the most current information
available is listed here.
W I N S T O N S AL E M , N O R T H C AR O L I N A 13
Aside from the exciting changes taking
place in Innovation Quarter, downtown
Winston-Salem’s living, shopping, food,
and entertainment options continue to
expand and to grow in number and
variety. Now home to seven breweries,
Winston-Salem’s downtown has received
national recognition as one of the best
in the U.S., based on factors such as
entertainment options and green space.
INCENDIARY BREWING, Winston-Salem’s
seventh craft brewery, is located beneath
the former railroad tracks and coal pits
of Bailey Power Plant. The plant once
generated electricity for the entire complex
of Reynolds Tobacco companies.
14 2018 AN NUAL R E P O R T
DOWNTOWN DEVELOPMENT
Downtown is now home to 2,250 residents — more than triple the 75-room boutique hotel that will bring the 1927 Pepper Building
number in 2010 — who live in housing developments in or near back to its former art deco glory, including the revival of the Sir
the area. More residential options are on the horizon, with Winston Steakhouse and Martini Bar on the rst oor and the
construction underway on 344 apartment units in Innovation Prince Albert restaurant and bar in the basement. In a green space
Quarter and another 229 on the western end of downtown. adjacent to the building, developers Mayfair Street Partners will
be enhancing an existing public space by adding restrooms and
Downtown Winston-Salem has become a thriving neighborhood
and social scene. Sidewalks bustle every night of the week with sidewalks. Mayfair will receive $4.6 million in assistance for this
project, to be known as Merschel Plaza in honor of former City
thousands of residents socializing, walking dogs and visiting an
array of restaurants o ering food as diverse as pizza, gourmet food Council member Wanda Merschel.
cooked with locally sourced products, and ethnic foods including Downtown development, as well as recruitment of new business
Mediterranean, Thai, Vietnamese and Mexican. Sweet Potatoes, a to the City as a whole, has largely resulted from the leadership and
downtown restaurant serving Southern classics such as fried okra, strategic moves of the City Council and the Winston-Salem Alliance,
three-cheese macaroni, and cornbread accompanied by a cold a non-pro t alliance headed by Mayor Allen Joines, with
glass of buttermilk, has received accolades in national publications. membership that includes some of Winston-Salem’s most in uential
The increase in restaurants and entertainment venues downtown has companies and organizations. Other key players have included the
in part been the result of a special emphasis by the City’s Small Winston-Salem Chamber of Commerce; the Downtown Winston-
Business Loan Program, which can be used to help nance restaurants Salem Partnership; and Winston-Salem Business, Inc., which is
when the applicants demonstrate a need for City assistance. charged with external economic development.
A historic landmark of downtown is the Kimpton Cardinal Hotel, The Downtown Partnership also manages enhanced services that
once the headquarters of Reynolds Tobacco Co. The building, ensure a high standard for cleanliness and safety in downtown.
known as “The Grand Old Lady” in Winston-Salem, was the A Downtown Winston-Salem Business Improvement District,
architectural inspiration for the Empire State Building in New York. which covers 60 blocks, is overseen by an 11-person advisory
It now includes 174 guestrooms, 36 suites, and The Katharine committee of various downtown stakeholders. The BID collects
Brasserie and Bar on its lower six oors. The hotel’s upper oors fees of 9 cents per $100 of valuation on real and personal property
have been converted into 120 rental units. to pay for extra services focused on ve primary goals: a cleaner
environment, increased safety and security, stronger marketing and
Under construction now are a 119-room Hampton Inn and Suites,
a 126-room Courtyard by Marriott, and a Hotel Indigo that will be promotion, accelerated development, and an enhanced physical
located in the long vacant Pepper Building. The Indigo plans a appearance for downtown.
2018-2019 City Budget and Improvements
The City Council approved a $530 million budget for 2018-2019, April 2019 from $11.25 per hour to $12.50 per hour, with a goal
an increase of $48.8 million over the previous year. The budget of achieving $15 an hour by 2021, according to City Manager
allocates $363 million for operations, $42 million for debt service Lee Garrity.
and $125 million for capital improvements. The property tax rate In spring 2018, the City-County Utility Commission approved
remains the same, at 59.74 cents for every $100 of value.
a 3.5 percent increase in the water rate and a 5 percent increase
In November, voters will be asked to approve $122 million in in the sewer rate, and the bimonthly service charge for residential
general obligation bonds. If passed, the bonds would require a water and sewer service would increase by $1.41 per month.
property tax increase of about 4 cents per $100 of value.
The rate changes will support the utility commission’s $45.5
Last year, about half of all City employees received raises to bring million budget for operations, $51.5 million for debt service and
them up to the market rate for their positions; the proposed a $114.7 million budget for capital improvements, the largest
budget would bring the other half up to market rate or provide being a $55 million upgrade to the Neilson Water Plant. With the
a raise of at least 2 percent. These pay raises will take e ect rate increase, the monthly cost for the average household user
April 1, 2019. The City’s minimum wage for its workers will rise in will go from $46.75 to $49.69.
W I N S T O N S AL E M , N O R T H C AR O L I N A 15
A Great Place to
Live and Work
Opened in spring of 2018, WINSTON WATERWORKS
o ers a pool, diving area, spray ground, restrooms,
concession area and shelter and is an enormously
popular addition to Winston Lake Park.
16 2018 AN NUAL R E P O R T
“ pen and progressive meets classic southern, and the result is arts, smarts and superb
livability,” according to Bestcities.org, which ranks Winston-Salem 32nd out of the top
O50 of America’s Best Small Cities. The ranking is based on factors such as quality of life,
infrastructure, prosperity, educational institutions and arts and entertainment o erings.
COMMUNITY PROFILE 2017•2018
National surveys continue to praise Winston-Salem for its inspections, facilities maintenance, building inspections
amenities and a ordability. Both CNN Money and Forbes and housing code enforcement. The result is improved
have rated the City one of the Top 10 Places to Retire. responsiveness and work ow.
Lending Tree ranks Winston-Salem the fth best place in Through www.cityofws.org, residents are able to request
the U.S. for rst-time home buyers, based on a ordability services, pay bills, register for recreation programs, conduct
and the size of down payments. Right Click, an online business with the Inspections Department, watch archive
technology newsletter for Verizon, recently ranked Winston- video tape of City Council meetings, and more. CityLink,
Salem third in the nation on its list of Best Cities in the U.S. the City’s call center, gives residents a single number (311)
For Young IT Professionals. WalletHub, a personal nance to call to request City services, report problems, pay bills,
website, has ranked Winston-Salem in the top 20 of its Best and make suggestions. Citizens may also call CityLink after
Large Cities to Start a Business.
hours to report emergencies such as water main breaks and
As the City of Arts and Innovation, Winston-Salem continues downed trees in roadways. Winston-Salem has also been
to diversify its entertainment and cultural o erings. Its recognized for its continued support of WinstonNet, a
reputation as a good city for “foodies” is growing, with new community program that provides free access to the
restaurants o ering a wide range of local and international Internet and computers in various locations around the City.
cuisine continuing to open in the downtown area. Winston- Keep Winston-Salem Beautiful, an a liate of Keep America
Salem is now home to seven craft breweries, including Beautiful, has received national recognition for the many
Foothills Brewing, the oldest, founded in 2005 and now innovative programs it has developed. The group holds
one of the largest regional brewers in the Southeast. The annual events including Community Roots Day, during
newest, Incendiary Brewing, opened in 2018 in the former which trees and shrubs are planted in parks, greenways, and
coal pit of Bailey Power Plant in Wake Forest Innovation rights-of-way throughout the City. Other annual events are
Quarter. On the cultural front, the nationally respected the Great American Clean-up in the spring, in which
River Run International Film Festival and the biennial volunteers clean up streets, parks, and school grounds; the
National Black Theater Festival draw tens of thousands of Big Sweep in the fall, which focuses on cleaning up local
visitors to the City.
waterways; and the annual Flower Bulb Distribution of
The City is also rapidly gaining national recognition for donated surplus ower bulbs to gardening clubs and other
bicycling. Now in its sixth year of existence, the Winston- organizations that plant them in areas visible to the public.
Salem Cycling Classic continues to grow in prestige among
cycling professionals nationwide, with more of the country’s
top riders spending their Memorial Day weekends
competing in the City. Renovations are also underway to
transform a 1918 downtown building into a National
Cycling Center, which will include cycling training
equipment and double-occupancy rooms that can be used
for housing cycling teams coming here to train.
Winston-Salem has also been named one of America’s Top
10 Digital Cities for 15 years in a row by the Center for
Digital Government. In 2017, the Center rated Winston-
Salem second among cities with a population of 125,000 to
249,999. The Center’s judges continue to be impressed with
Winston-Salem’s commitment to using digital media for city
services. The City has provided mobile devices to employees
of departments as diverse as engineering and zoning
W I N S T O N S AL E M , N O R T H C AR O L I N A 17
HOUSING
Winston-Salem’s many housing options give citizens of all units will be set aside, for 10 years, for residents earning 80
income levels the means of nding living space that suits both percent of the area median income. After the 10-year period, 15
their budget and their lifestyle. percent of the units will be set aside for an additional 20 years.
Residents looking for heritage and tradition make their homes To promote quality of life throughout the community, the City
in such long-established neighborhoods as Buena Vista, works to revive blighted neighborhoods. The Housing
Monticello Park, Morningside Manor, Sherwood Forest, Rehabilitation Program provides nancial and technical
Town and Country, Wedgewood and the Country Club assistance to quali ed homeowners and investors wanting to
Road area. Families seeking luxury homes built for today’s repair substandard properties. Owner-occupants with low
lifestyle have a multitude of choices in such newer and moderate incomes are eligible for direct and deferred
neighborhoods as Brookberry Farm, Greenbriar Farm, Lake payment loans, and investor-owners are eligible for loans to
Park and Timberfield. repair single family houses for rental. Housing Rehabilitation
also administers the Section 3 Construction Training Program
City residents looking for historic neighborhoods can move to
Washington Park, West End, West Salem and Ardmore. In Initiative, which trains unskilled and underemployed
individuals in construction elds. The Neighborhood
the Old Salem Historic District, a number of houses dating to
the late 1700s and early 1800s have been refurbished for Redevelopment and Improvement Program works with
residents to develop plans to revitalize their neighborhoods.
modern life.
These e orts can include a combination of renovation,
With rapid growth in downtown residential construction, demolition of blighted property, and construction of new homes.
residents seeking a true urban lifestyle have a diverse range of Boston-Thurmond, a historic African-American neighborhood,
options for renting or buying. Many downtown loft apartments
and condominiums have been repurposed from old textile is being revitalized through a partnership between the City,
County, private developers, and Habitat for Humanity of
and tobacco factories, including the Gallery Lofts, luxury
apartments in the renovated former Brown & Williamson Forsyth County. In 2012, Habitat began its new Neighborhood
Revitalization program, a partnership with the City and other
factory; Plant 64, created from an old Reynolds tobacco
warehouse, and the Winston Factory Lofts, created in the organizations to renovate and repair existing homes located
among the newer houses Habitat has been building. In
renovated Brown Rogers-Dixon building. Other options
include West End Village and the Link Apartments addition, private developers have rehabilitated other single-
family homes and several two-story brick apartment buildings
Brookstown, both within walking distance of the BB&T
Ballpark. Two new downtown apartment complexes, the that have been recognized by the National Historic Register as
one of the few remaining examples of “Y” staircase architecture.
Link Apartments Innovation Quarter and West End Station,
are currently under construction and will add 573 new units to In partnership with the United Way of Forsyth County,
the market. Habitat has also begun building new homes and renovating
existing ones in the Bowen Park neighborhood. Bowen Park
As part of the 2014 bond referendum passed by voters, the
City contributed $1.25 million to the construction of the 757 is among a cluster of neighborhoods in the designated United
Way Place Matters community near Smith Reynolds Airport.
North apartment complex. In return, 25 percent of the 115
LINK APARTMENTS
INNOVATION QUARTER
is currently under
construction and will add
many new units to the
growing market.
18 2018 AN NUAL R E P O R T
RECREATION
City residents enjoy an enviable array of recreational opportunities: The department’s 17 recreation centers collectively o er hundreds
the excitement of college sports, championship-caliber golf of programs and activities for all age groups. The centers are also
courses, a national tennis tournament and professional bike racing, tied in to WinstonNet, the community high-speed computer
minor league baseball, North Carolina’s second largest fair, and network that was created to ensure that all citizens have access to
many other amenities provided by City government, local the opportunities that computers provide, even if they don’t have
universities, and businesses. The City’s Piedmont location gives a computer at home.
residents easy access to both the North Carolina mountains and its In 2013, the 15,000-seat Lawrence Joel Veterans Memorial
world-famous beaches.
Coliseum was purchased from the City by Wake Forest University
Aside from becoming an attractive City for professional cycling, for $8 million. Wake Forest’s basketball team uses the facilities and
Winston-Salem residents seeking to bike for their own tness, now has the opportunity to sell naming rights to help support its
recreation or general transportation can take advantage of 25 athletic programs. The City and Wake Forest have agreed to keep
miles of greenways and 11 o cial City bike routes, including 18 the name and the veterans’ memorial designation on the coliseum
miles of on-street marked bike lanes. In spring 2018, the City façade and on its marquee as part of any sale, although the school
celebrated the opening of the 1.7-mile Long Branch Trail, which may pursue naming rights for the coliseum. The coliseum
connects downtown and Innovation Quarter to the existing Salem continues to host concerts and family entertainment.
Creek Greenway. The trail takes walkers, runners and bikers along The City still owns the 4,500-seat Fairgrounds Annex, a free-standing
an inactive Norfolk and Western Railway line that once carried facility with a basketball court that can be set up for a regulation-
tobacco products from Winston-Salem to Roanoke, Virginia.
size hockey rink. In fall 2017, the Annex became the home base for
All of these amenities are managed by the Winston-Salem a new hockey team, the Carolina Thunderbirds.
Recreation and Parks Department, which is recognized as a The City also owns the adjacent fairgrounds, home to the Dixie
leader in serving the recreation needs of its residents. Through public Classic Fair. Second in size only to the N.C. State Fair, the Dixie
meetings and a special designated web page, the City is currently Classic Fair draws more than 325,000 visitors annually from as far
seeking public input as it develops a new Bicycle Master Plan.
away as Virginia, Tennessee, and South Carolina to enjoy the rides,
Thanks to a 2014 bond referendum, a former Vulcan Materials play games on the midway, and eat delicious “fair food.” The fair
quarry has been transformed into Quarry Park, 200 acres of also features concerts, family entertainment, a petting zoo, and
mostly wooded land. Visitors can now see the Winston-Salem exhibits and contests for livestock, crops, crafts, and baking that
skyline in the distance from a pier overlooking a freshwater lake. draw thousands of entries.
Another bond project, the $4 million construction of a new marina, Bowman Gray Stadium, a legendary site for NASCAR’s longest-
training building, playgrounds and restrooms at Salem Lake, was running weekly racing series, is also the home eld for the WSSU
completed in fall 2017.
Rams football team. The City and WSSU are in discussion about the
Also as a result of the bonds, the new Winston Waterworks water possible purchase of the stadium by WSSU, pending approval by the
park opened in spring 2018. The park, which includes a pool, N.C. Legislature. The purchase of the stadium and surrounding
diving area, spray ground, restrooms, concession area and shelter, acreage would provide opportunities for future campus growth.
is an enormously popular addition to Winston Lake Park, which WSSU will also honor provisions in the stadium’s contract with
also includes the Winston Lake Golf Course. Recreation and Parks Winston-Salem Speedway, Inc., to continue the lease for NASCAR
also operates the Reynolds Park Golf Course. races through 2031.
In all, Recreation and Parks operates and maintains 74 parks. The BB&T Ballpark, home of the Winston-Salem DASH Class-A
Among them are 51 picnic shelters, 47 playgrounds, 43 soccer professional baseball team, is a beautiful, classically-designed brick
elds, 47 softball elds, 112 tennis courts, eight pools, six volleyball ballpark. The ballpark includes luxury suites and a children’s play
courts, 25 basketball courts, a hobby park, a football eld, and two area with a merry-go-round.
dog parks. The Fairgrounds Skate Park o ers 15,200 square feet The Winston-Salem Open Tennis Tournament marked its eighth
of ramps, quarter pipes, grinding rails, bank ramps and more for year in 2018. The Open is held in a new tennis facility constructed
skateboarders of all abilities. The park has a 325-foot-long “pump” next to BB&T Field, the Wake Forest University football stadium.
track, an undulating track of dips and banks that helps riders The stadium includes 13 courts, making it eligible to host future
master the basics of how to balance and handle their bikes, NCAA tournament events.
skateboards and roller skates without the risk of major injury.
W I N S T O N S AL E M , N O R T H C AR O L I N A 19
THE MILTON RHODES
CENTER FOR THE ARTS
is the “hub” of downtown
arts in Winston-Salem.
DOWNTOWN ARTS
As the rst local arts council in the country, established are in the North Trade Street Arts Center, which also
in 1949, The Arts Council of Winston-Salem and serves as a gallery for visual and performing artists.
Forsyth County has been a national model in marshaling DADA promotes art and the arts district through events
support for civic arts and culture. Branded as “the City of such as its signature First Friday Gallery Hops, held the
Arts and Innovation,” Winston-Salem is nationally known rst Friday of each month throughout the year. During
as a center of excellence in both visual and performing these free events, the streets in the district are bustling
arts and supports about 5,000 arts-related jobs. A study with music, entertainment and food as studios, galleries,
by Americans for the Arts, a national nonpro t and shops are open for extended hours.
organization, estimated that full-time jobs in the Located in the heart of the arts district, ARTivity on the
nonpro t arts and culture sector in Forsyth County rose
15 percent, to 5,559, between 2010 and 2015. The total Green is a half-acre public art park on Liberty Street. The
park itself is a unique work of art with towering faux
economic impact of both sectors doubled in that
period, from $76.6 million to $156.8 million. smokestacks with color-changing nighttime lighting.
The structures release clouds of water vapor as a nod to
The Milton Rhodes Center for the Arts, which is owned the City’s industrial past. The park also features green
and operated by The Arts Council, is the “hub” of space for sitting and picnicking, a mural wall, and a
downtown arts in Winston-Salem. Part of the Center is a bandstand. The park was initiated by Art For Art’s Sake
former textile mill more than 100 years old, which has (AFAS), a non-pro t volunteer group that works to
been renovated to provide modern performing arts build, educate and celebrate the community through
spaces, public art galleries, arts education, and corporate art. Located beside the park is the group’s modern
and special events space. It houses the Sawtooth headquarters building, the AFAS Center for the Arts. It also
School for Visual Art, Associated Artists of Winston- houses Red Dog Gallery and inexpensive studio space for
Salem, and Coffee Park Downtown. There’s always rent by local artists. AFAS hosts the Arts on Sunday, a series
something happening at the Center: live performances, of free afternoon arts and crafts held outdoors on Liberty
lm screenings, art showings, artist receptions, art Street on Sundays in May and September.
classes and special events. For more than two decades, the Downtown Summer
The Hanesbrands Theatre is adjacent to the Milton Music Series has infused downtown Winston-Salem with
Rhodes Center and also owned and operated by the live music and festivities from June through August. The
Arts Council. It is a state-of-the-art performance venue two-part series includes Downtown Jazz, held in
for theater, dance, lm and music as well as a private Corpening Plaza on Fridays, and Summer on Liberty,
meeting and special events venue. held on 6th and Liberty Street on Saturdays. The free
Winston-Salem boasts a thriving Downtown Arts events are an essential part of summer in the City, attracting
District with working studios, galleries, locally-owned around 60,000 people of all ages, cultures and backgrounds.
retail shops, restaurants, bars, residences, and businesses. The Summer Music Series is produced by The Downtown
The eclectic “Arts District” is found along 6th, Liberty and N. Winston-Salem Partnership, the non-pro t organization
Trade streets and features a mix of restored historic reimagining downtown into a ourishing commercial,
buildings and modern structures. Celebrating its 20th cultural and residential district. The group also sponsors
anniversary, the Downtown Arts District Association the annual downtown Restaurant Week in February, the
(DADA) is the non-pro t organization leading the Spirits of Summer celebration in June featuring N.C.
revitalization of this area of downtown. Its headquarters wines, beer, food and music, and the Christmas tree lighting.
20 2018 AN NUAL R E P O R T
ARTIVITY ON THE GREEN is
a half-acre public art park on
Liberty Street.
W I N S T O N S AL E M , N O R T H C AR O L I N A 21
FESTIVALS AND ANNUAL EVENTS
Winston-Salem’s vibrant downtown o ers an array of largest Hispanic festival in the region and all proceeds support
shopping, dining, cultural, and recreational experiences cultural, health, education, and college scholarship programs
year-round. The newly renovated Benton Convention for the Hispanic/Latino community.
Center, part of Twin City Quarter, is central to the City’s Winston-Salem is the home of the National Black Theatre
festivities. In fact, the downtown area hosts about 2,500 Festival, held biennially in August and renowned for
events each year and employs approximately 27,000 celebrity appearances and performances. Also based in
people in the district.
Winston-Salem, the festival is produced by the North
The Piedmont Craftsmen’s Fair is held each year at the Carolina Black Repertory Company, the world’s largest
Benton Convention Center and showcases the works of showcase of black theatre. The six-day festival o ers
over 100 ne artisans from across the Southeast in a hundreds of performances of professional theatre, lm,
setting that allows shoppers to meet the crafts people, poetry, workshops, seminars, and shopping. As the
talk to them about their work, and view demonstrations City’s largest festival, it attracts more than 65,000 patrons
of craft techniques. The fair, which has been held each to performances by black theatre groups from across
year since 1963, takes place one weekend each November, the country. The festival returns to Winston-Salem in 2019.
allowing visitors to get a jump start on holiday shopping. Celebrating its 20th year, the RiverRun International
Held at venues throughout Winston-Salem, the Film Festival is held in downtown Winston-Salem and
Bookmarks Festival of Books & Authors is the largest has become one of the preeminent lm festivals in the
book festival in North Carolina. The four-day festival Southeast. The competitive festival attracts attendees
continues to gain in status and popularity, hosting authors from throughout the South and o ers a diverse program
from all genres, including best-selling writers such John from lm studios, independent distributors and rst-
Grisham, Diana Galbaldon and Dave Pilkey, author of the time lmmakers. RiverRun is a 10-day festival held each
wildly popular children’s series “Captain Underpants.” The April, with about 150 screenings of feature-length and
Bookmarks Bookstore is located downtown on Fourth short lms from around the globe spanning all genres.
Street and hosts regular author appearances and events The movies are shown at di erent venues throughout
for all ages of readers. Winston-Salem, including a/perture cinema, a non-
pro t art-house cinema featuring two 80-seat theaters,
Organized by the Hispanic League, the annual FIESTA
street festival attracts over 20,000 and is the League’s one 45-seat screening room, and a 25-seat alternative
largest fundraiser. The free multicultural event includes live viewing room. The locally-owned theater screens a mix
Latin music, cultural programs, a children’s area, Latin cuisine, of independent, foreign, documentary, local and festival
local arts and crafts, and a beer and margarita garden. It’s the lms year-round.
22 2018 AN NUAL R E P O R T
FIESTA STREET FESTIVAL is the largest Hispanic
festival in the region with all proceeds supporting
cultural, health, education, and college scholarship
programs for the Hispanic/Latino community.
W I N S T O N S AL E M , N O R T H C AR O L I N A 23
THE STEVENS CENTER, one of the
City’s principal performance venues.
PERFORMING ARTS ORGANIZATIONS AND VENUES
Located on Fourth Street in downtown, the Stevens Center is and choral concert music, opera, oratorio, ballet, and popular
one of the City’s principal performance venues. A magni cently music. It’s one of the Southeast’s most highly regarded
restored, two-story 1,364-seat neoclassical theatre, it is the orchestras, with an annual program that includes about 20
primary performance space for the University of North performances.
Carolina School of the Arts (UNCSA), the Winston-Salem As the oldest performing arts organization in the City, The
Symphony, Piedmont Opera Theatre, the National Black Little Theatre of Winston-Salem has been contributing to
Theatre Festival, and other local, national and international the performing arts scene for more than 80 years. Based on
performances each year. Each December it is transformed into Coliseum Drive just north of downtown, the Theatre produces
the fairy tale setting for UNCSA’s annual production of the at least six professional quality plays and musicals each year,
timeless holiday classic, “The Nutcracker.” The Piedmont Opera, involving hundreds of volunteers lending rst-class talent,
the second largest opera company in North Carolina, brings rst- energy, and countless hours to the performances. The group
rate regional, national and international singing actors and also o ers annual performances speci cally for school groups
technicians to work with a full orchestra and a chorus of local as well as acting classes and summer camps for youth.
singers. Enduring for more than 40 years, the Opera performs
two regularly scheduled productions each year in addition to Many other performing arts and theatrical groups are found in
numerous educational and outreach programs. Winston-Salem, including Triad Stage, the Winston-Salem
Theater Alliance, the Piedmont Chamber Singers, the
The Stevens Center is also the home base of the Winston- Piedmont Wind Symphony, Camel City Jazz Orchestra, the
Salem Symphony. For over 70 years, the group has been Winston-Salem Festival Ballet, Winston-Salem Youth
providing an array of repertoires, including classical orchestral Chorus, and more.
24 2018 AN NUAL R E P O R T
ART MUSEUMS
Winston-Salem is home to several signi cant arts museums and folk art through furniture, paintings, textiles, ceramics, silver, and
cultural centers. The City’s premiere art attraction, the Reynolda other metal wares made and used in the Southeast. The museum
House Museum of American Art, is housed in the restored 1917 contains the most extensive collection of Moravian decorative arts
estate of Katharine and Richard J. Reynolds, the founder of R.J. and o ers an exhibit dedicated solely to this area’s early settlers.
Reynolds Tobacco Company. The epicenter of the Reynolda Housed in the Frank L. Horton Center, MESDA is open for guided tours
Historic District, the museum opened in 1967 and has gained a six days a week. MESDA is also home to the nationally acclaimed
reputation for having the Southeast’s nest collection of American MESDA Research Center, which contains vast object and craftsman
art. It features art in an array of mediums ranging from the colonial databases.
period to the present. A 300-piece permanent collection is housed The Delta Arts Center is an art gallery, cultural center and rental
in the historic mansion, which also includes restored interior rooms facility. Since 1972, the Center has enriched the City’s art scene by
to re ect the periods in which the Reynolds family lived there. A showcasing visual and performing arts with an emphasis on the
modern addition, the Mary and Charlie Babcock Wing, includes contributions of African-American artists. Open to the public two
educational space, a gallery for temporary exhibits, an auditorium, days a week or by appointment, the center features regular exhibits,
and ne art and archival space. The permanent collection includes concerts, performances, special events, youth camps and educational
works by Frederic Church, Mary Cassatt, Georgia O’Kee e, Grant programs, most of which are free and open to the public.
Wood, Stuart Davis and Jacob Lawrence. A liated with Wake
Forest University, also located on the original 1,000-acre Reynolds As the cultural center of Winston-Salem State University, Diggs
estate, Reynolda House is a self-tour museum that also hosts Gallery is recognized as one of the top 10 African-American
concerts, lectures, classes, lm screenings and other events. The galleries in the nation. It showcases the premier collection of
adjacent Reynolda Gardens of Wake Forest University and African and African-American art in the South, which includes a
historic Reynolda Village include lush formal gardens, restaurants, unique sculpture garden and murals by the acclaimed artist John T.
shops and wooded walking and running trails. Biggers. Diggs also hosts an impressive collection of works on
paper by well-known European and American artists such as Jean
The Southeastern Center for Contemporary Art (SECCA), also Francois Millet, Joan Miro and Robert Rauchenberg. Exhibitions
located in the Reynolda Historic District, is housed in the former and programs address a broad range of artistic expression, with
estate of industrialist James G. Hanes. It provides various ways to special concentration on African-American and regional art.
experience the art of our time through visual exhibits of
international and American contemporary artists in all mediums. The Enrichment Center is a non-pro t organization that develops
SECCA o ers year-round education programs and hosts a number artistic talent, education and employment for adults with
of community events. It is an a liate of the North Carolina Museum of intellectual and developmental disabilities. It o ers programs in
Art, a division of the North Carolina Department of Cultural Resources. visual and performing arts as well as opportunities for public
exhibitions and performances. The Center’s Gateway Gallery
Winston-Salem is home to the world’s only museum dedicated o ers exhibition and sales space for its students, the Artists of Gateway
to collecting, exhibiting and researching the decorative arts Studios, who create original paintings, digital photographs, ceramic
and crafts of the early South, The Museum of Early Southern and multi-media pieces. The artists receive commission from
Decorative Arts (MESDA). As part of Old Salem Museums & gallery sales, giving them the opportunity to earn a living from
Gardens, MESDA galleries showcase a diverse array of ne art to
their art.
THE REYNOLDA HOUSE, the restored
estate of Katharine and Richard J. Reynolds,
founder of R.J. Reynolds Tobacco Company,
W I N S T O N S AL E M , N O R T H C AR O L I N A 25
K 12 EDUCATION
Winston-Salem provides quality
primary and secondary schooling and
o ers a comprehensive selection of
higher education institutions.
26 2018 AN NUAL R E P O R T
As the fourth largest school system in North Carolina, may also earn college credit through the International
Winston-Salem Forsyth County Schools (WSFCS) provide Baccalaureate Diploma Programme, dual enrollment at
a quality education for around 55,000 students in 80 Forsyth Technical Community College, or through other
schools. Programs exist to serve a diverse array of students, local colleges and universities. The school system has
including a new food truck that provides meals for students increased the graduation rate to 86.5 percent, the highest
with food insecurities during the summer months when rate since the state began calculating it in 2006. Schools in
school is not in session. the district receiving national recognition include the Early
College of Forsyth County, as one of America’s top high
The Board of Education o ers the “Schools of Choice” schools by Newsweek, and R.J. Reynolds High School,
process, giving parents options on choosing schools.
Elementary schools are divided into 11 zones, and middle named as a Nationally Certi ed Magnet School.
schools are divided into seven zones. Parents may choose In addition to public schools, parents have the option of
from their neighborhood school, another school within their sending their children to numerous private schools in the
zone, or from 20 magnet schools. The system is equipped to Winston-Salem area, both secular and church-a liated.
o er programs and services for students throughout the Options include private schools that o er programs from
educational spectrum and with various needs. kindergarten through 12th grade, while others focus on lower
grade levels. There are also a number of charter schools in
High school students have the option to take classes at the
standard, honors and Advanced Placement levels. They the area from which parents may choose.
WAKE FOREST UNIVERSITY
HIGHER EDUCATION
Winston-Salem has a diverse array of colleges and universities. enhance residential, academic and athletic spaces for
students, including the $60 million transformation of its
Wake Forest University (WFU) is a private university with a historic Reynolds Gym into a state-of-the-art Wake Forest
liberal arts curriculum. Enrollment consists of approximately
5,000 undergraduates and 3,000 graduate and professional Wellbeing Center.
students. Consisting of three campuses, Wake’s “main” 345-acre For more than 20 years, U.S. News & World Report has ranked
Reynolda Campus is home to most of its undergraduate the university in the top 30 of its annual “Best Colleges”
programs, the Graduate School of Arts and Sciences, the guide. Its Schools of Law and Business consistently rank
School of Business, the School of Law and the School of among the nation’s best graduate schools in the country.
Divinity. Classrooms and laboratories of the esteemed WFU has been listed on The Princeton Review’s list of “Best
Wake Forest School of Medicine are divided between the Value Colleges,” and its undergraduate business program
Wake Forest Baptist Health medical complex, located just has been listed among the top 20 “Best Undergraduate
west of downtown, and Wake Forest Innovation Quarter. Business Schools” by Bloomberg BusinessWeek.
Wake Downtown, a transformed former tobacco company WFU’s “Demon Deacons” compete in Division I athletics of
building, houses new undergraduate biomedical science the NCAA. Wake has won eight national titles in sports such
and engineering programs. Wake’s athletic facilities include as eld hockey, baseball, men’s golf, and men’s soccer. The
BB&T Field, David F. Couch Ballpark, Kentner Stadium, Wake Deacons have played in the Orange Bowl as well as in
Forest Tennis Center, Spry Soccer Stadium, and Lawrence numerous Atlantic Coast Conference title games. Its athletes
Joel Veterans Memorial Coliseum. The University is in the excel in the classroom as well, with a 94 percent student-
midst of a 10-year, $625 million construction e ort to
athlete graduation rate.
W I N S T O N S AL E M , N O R T H C AR O L I N A 27
WINSTON SALEM UNIVERSITY OF NORTH CAROLINA
STATE UNIVERSITY SCHOOL OF THE ARTS
Winston-Salem State University (WSSU), a historically black Not surprisingly, the “City of Arts and Innovation” is home to
university founded in 1892, is a distinguished public institution the nation’s rst state-supported residential arts school, The
o ering over 40 undergraduate degrees and 10 graduate University of North Carolina School of the Arts (UNCSA).
programs, both master’s and doctorate. WSSU is part of the Opened in 1965, UNCSA is a public visual, performing and
University of North Carolina system, with about 6,400 moving image arts conservatory with an international
undergraduate and graduate students. Rising enrollment has reputation for training talented students for professional
led to two major construction projects on the campus just careers in the arts. Enrollment is at an all-time high, with about
outside of downtown Winston-Salem: a new $24 million 1,300 students from high school through graduate levels, who
residence hall and a $53 million sciences building. come from throughout the U.S. and the world.
WSSU is recognized for its core strengths in education and Students must audition or interview for admission and are
health sciences and has grown to include innovative programs trained for careers through ve professional schools: Dance;
that meet the needs of a rapidly changing job market. The Design and Production; Drama; Filmmaking; and Music. The
University consistently ranks among the top public universities school o ers a Master of Music degree as well as a Master of
in the South, with award-winning programs like its motorsports Fine Arts in either Design and Production or Filmmaking.
management major, the only program of its kind in the nation Students study with resident master teachers who have had
o ered by a four-year university. It consistently ranks as the successful careers in the arts and who remain active in their
top University in the state for graduating African-American professions. With a primary focus on the performing arts,
students in the nursing, health sciences, and education elds UNCSA students present hundreds of public performances
and is recognized as one of the top Historically Black Colleges and screenings annually, not only in Winston-Salem but across
and Universities by U.S. News & World Report. WSSU is nationally the state, in major U.S. cities, and overseas.
recognized as a social mobility innovator for programs and Graduates of UNCSA have performed on Broadway, in the
services that take students from low income backgrounds American Ballet Theatre, the New York Philharmonic, and in
and graduate them into promising careers.
numerous TV shows and major lms. Its alumni have either
The WSSU “Rams” athletic teams hold numerous titles at both won, or been nominated for, all major awards in the
the conference (CIAA) and national levels in basketball, entertainment industry including Tony, Oscar, Emmy, and
football, baseball, wrestling, softball, track and eld, and golf. Grammy awards. UNCSA’s School of Drama is ranked among the
WSSU’s football, basketball and baseball programs have been top ve undergraduate theatre programs in the country and its
ranked in the top 25 of the NCAA’s Division II. School of Filmmaking is ranked 14th by The Hollywood Reporter.
28 2018 AN NUAL R E P O R T
Salem College, founded in 1772, is the oldest women’s school in Forsyth Technical Community College has an enrollment of
the country and the 13th oldest college. Established by Moravian about 12,000 credit students, making it one the largest community
settlers who championed independence for women in thought colleges in North Carolina. The college o ers over 200 programs of
and action, the College is located in the Old Salem historic area. study that lead to college transfer, associate’s degrees, and
Many Moravian traditions remain at the heart of the college today. certi cates or diplomas in such elds as health care, engineering
With an enrollment of more than 1,100 students from all over the technologies, criminal justice, automotive technology, logistics
world, Salem takes pride in having the most racially and ethnically management, nanotechnology, and biotechnology.
diverse student population of any local four-year institution. The Forsyth Tech has the largest health technology and biotechnology
all-female liberal arts college o ers a full range of undergraduate degree programs in the state, as well as Richard Childress Race Car
degrees, as well as graduate degrees in education and music, teacher Technology Program. It recently opened the Center for Advanced
licensure, and four certi cate programs. Salem recently opened the Manufacturing to provide students with the cutting-edge technology
new Center for Women in Business and Entrepreneurship, a and technical training needed to meet industry demand. It was one of
downtown space where students can network and grow in their the rst four colleges in the country to pilot the National Association
knowledge of the global economy.
of Manufacturers (NAM) Endorsed Skills Certi cation System. Forsyth
The Salem “Spirits” athletic teams compete in Division III of the Tech’s Davis iTEC Cyber Security Center was the rst in the state to
NCAA and are also members of the Great South Athletics be named a Center of Academic Excellence in Cyber Defense
Conference. Money magazine consistently ranks Salem as one of Education by the National Security Agency and the Department of
the “Best Buys” of colleges in America,” and U.S. News & World Report Homeland Security. It is home to The National Center for the
ranks the college as 11th in the nation among women’s colleges Biotechnology Workforce, o ering the only degreed community
and number one in the state. Salem is named as a 2018-2019 college nanotechnology program in the Southeast.
College of Distinction for innovative learning in ve categories: To fully support student, employer, and community needs, Forsyth
independent research, study abroad, service learning, internships, Tech also provides customized training for employers as well as
and living/learning communities.
services for entrepreneurs through its corporate training, workforce
development, and continuing education programs, as well as the Forsyth
Tech Small Business Center. With two campuses and eight a liate
locations, Forsyth Tech is a key educational resource for thousands
of adults going back to school or retraining for new skills.
FORSYTH TECHNICAL
COMMUNITY COLLEGE
SALEM COLLEGE
W I N S T O N S AL E M , N O R T H C AR O L I N A 29
Thanks to the 2014 bond referendum,
three new re stations have been
constructed, including STATION 8.
PUBLIC SAFETY
Public safety services for the community are provided by stations have been constructed, and designs are being drawn
professional police, re, emergency medical service and for renovations to the Public Safety Center, which will continue to
emergency management departments. All public safety serve as the main location for the WSPD’s administrative o ces.
agencies in the city and county as well as departments that The 2014 bond also included funds to replace, renovate or
operate key infrastructure, such as transportation and utilities, expand three aging facilities of the Winston-Salem Fire
are connected through a seamless 900 MHz radio system.
Department (WSFD). Led by Chief William “Trey” Mayo, the
The Winston-Salem Police Department (WSPD) marked the WSFD serves the community by providing a timely response
appointment of its 15th Chief of Police in 2017. Chief Catrina to calls involving re and situations necessitating rescue. The
A. Thompson assumed her duties Sept. 1 after the retirement of City of Winston-Salem has 19 re stations strategically located
Chief Barry Rountree. Thompson is a 24-year veteran of the WSPD, throughout the city. The stations are located to provide
most recently serving as the assistant chief in charge of the maximum coverage with an average response time of under
Investigative Services Bureau. She previously served in the Patrol four minutes.
Division, Recruiting Unit, Training Division and the Criminal The department strives for the prevention of unwanted res
Investigations Division. She leads a department with 559 sworn through enforcing re codes, arson investigation activities,
o cers and 173 civilian positions, and an annual budget of and community outreach. The WSFD conducts a four-week
$74.5 million.
Citizens Fire Academy that educates participants about
A major goal of the Police Department is to improve the ghting and preventing res, and allows them to handle a re
interaction and trust between police and citizens of all ages hose and re extinguisher and ride along with a re crew
and walks of life. The WSPD provides one school resource during a shift. The Fire Department also conducts re safety
o cer for every middle and high school within the corporate inspections, reviews construction plans, investigates re scenes
limits of the City. Another initiative, “Co ee with a Cop,” allows and issues re-inspection permits.
citizens to talk one-on-one with o cers at local co ee shops. The local Office of Emergency Management coordinates
The P2C (Police to Citizen) website allows citizens to view activities within Winston-Salem and Forsyth County that
police records, search for speci c incidents, get crash reports, contribute to the mitigation, preparedness, response, and
and easily submit an online report.
recovery of disasters. The o ce responds 24 hours a day
In a move to provide better policing, the WSPD is transitioning to disasters or potential disasters and is responsible for
to a system in which most patrol o cers will be housed in assisting private industry and the public with management of
three full-service district stations instead of one main station. hazardous materials.
Thanks to the 2014 bond referendum, three new district
30 2018 AN NUAL R E P O R T
INFRASTRUCTURE
Winston-Salem provides professional and nancially sound The Commission oversees the Winston-Salem/Forsyth County
municipal services. City residents have consistently shown their water treatment plants and distribution system, its wastewater
support of improvements that continue to enhance Winston- treatment plants and sewage collection system, the land lls for
Salem’s quality of life. The past year saw several major projects solid waste, construction and demolition debris, and yard waste. It
approved in a 2014 bond referendum come to fruition. The $139.2 maintains a sta of 377 employees who operate and maintain
million referendum included $30.85 million for parks and recreation; three water treatment plants, two wastewater treatment plants,
$10 million for housing programs; $25 million for economic three land lls, and a collection and distribution system that
development; $31 million for new public safety facilities; and includes 14 water tanks, seven pumping stations for fresh water, 52
$42.35 million for new streets and sidewalks. pumping stations for wastewater, and 4,094 miles of water and
For the last several years, the Winston-Salem/Forsyth County sewer lines.
Utility Commission has been rebuilding aging water and sewer The City’s three water treatment plants process a combined
infrastructure, some that is 80 or more years old, in older City capacity of 13 billion gallons per year, allowing plenty of capacity
neighborhoods. The Commission nances its own capital for future growth. Average demand is 35.7 million gallons per day,
improvements from water and sewer fees and revenue bonds that although it can double during hot, dry weather. The water system
are paid o with income from the water and sewer system. It does draws 70 percent of its raw water from the Yadkin River and 30
not have authority to issue bonds or debt without the approval of percent from Salem Lake. The system serves a population of
the City Council. approximately 344,000, with a water distribution system that
includes 2,324 miles of water distribution mains, 14 water tanks
In spring 2018, the Commission approved a 3.5 percent increase in
the water rate and a 5 percent increase in the sewer rate. The and seven pumping stations.
bimonthly service charge for residential water and sewer service The City’s waste-disposal needs have been provided for with the
would increase by $1.41 per month. Even with the increase, expansion of the Hanes Mill Road Landfill, which will extend the
Winston-Salem’s rate remains one of the lowest among North life of the land ll through approximately 2035. The commission also
Carolina’s large cities. operates a separate land ll for construction and demolition debris.
A 50-foot tall American river otter graces the SIDES
ROAD WATER TANK. The City-commissioned
public art mural encompasses a 15,000-square foot
space and is visible to about 25,000 drivers a day.
W I N S T O N S AL E M , N O R T H C AR O L I N A 31
WINSTON SALEM FAIRGROUNDS
FARMERS MARKET
The Fairgrounds Farmers Market is open
to the public at the Winston-Salem
Fairgrounds every Saturday throughout
the year. The farmers market features
locally-grown seasonal fruits and
vegetables, owers, jams, jellies, meats,
honey, a variety of crafts and fresh
baked goods.
32 2018 AN NUAL R E P O R T
W I N S T O N S AL E M , N O R T H C AR O L I N A 33
City of Winston-Salem
ORGANIZATIONAL CHART
CITIZENS of
WINSTON-SALEM
Boards and Mayor and City Attorney
Commissions City Council Angela I. Carmon
City Manager
Lee D. Garrity
Financial Management Marketing &
Services Communications
Lisa M. Saunders Ed McNeal
Assistant to the Human Resources
City Manager Carmen Caruth
Meridith J. Martin
Assistant Assistant City Assistant City Assistant City
City Manager Manager Manager Manager
Tasha Logan Ford Derwick L. Paige Ben Rowe Gregory M. Turner
Community Business Inclusion & Budget & Evaluation City Link
Development Advancement City Secretary Engineering
Recreation & Parks Emergency Information Systems Planning & Development
Special Projects Management Services
Fire Performance & Property & Facilities
Accountability
Human Relations Management
Office of Community Public Assembly Sanitation
Facilities
Assistance
Police Traffic Field Operations
Transportation
Utilities
34 2018 AN NUAL R E P O R T
City of Winston-Salem
MAYOR & CITY COUNCIL
Vivian H. Burke Denise D. Adams Dan Besse Robert C. Clark
Mayor Pro Tempore North Ward Southwest Ward West Ward
Northeast Ward
Allen Joines
Mayor
John C. Larson Jeff MacIntosh Derwin L. James Taylor, Jr.
South Ward Northwest Ward Montgomery Southeast Ward
East Ward
Derwick L. Paige, Assistant City Manager Financial Management Services
Gregory M. Turner, Assistant City Manager Angie S. Fisher, Assistant Financial Officer/Controller
Ben Rowe, Assistant City Manager Donna C. Hull, Assistant Financial Officer/Treasurer
Tasha Logan Ford, Assistant City Manager Darin N. Webster, Risk Manager
Lisa M. Saunders, Chief Financial Officer Larissa Mathis, City Revenue Collector
Meridith J. Martin, Assistant to the City Manager Jerry J. Bates, Purchasing Director
Carmen Caruth, Human Resources Director Dewey M. Williard, Accounting Services Manager
Ed McNeal, Marketing & Communications Director
Lee D. Garrity Bond Paying Agent
City Manager The Bank of New York Mellon Trust Co., N.A.
General Counsel New York, New York
Angela I. Carmon, City Attorney U.S. Bank National Association
Charlotte, North Carolina
Bond Counsel
Parker, Poe, Adams and Bernstein LLP Independent Auditors
Charlotte & Raleigh, North Carolina Dixon Hughes Goodman LLP
High Point, North Carolina
W I N S T O N S AL E M , N O R T H C AR O L I N A 35
Independent Auditors' Report
Honorable Mayor and
Members of the City Council
City of Winston-Salem, North Carolina
Report on the Financial Statements
We have audited the accompanying financial statements of the governmental activities, the business-type activities, each major
fund, and the aggregate remaining fund information of the City of Winston-Salem, North Carolina (the “City”), as of and for the
year ended June 30, 2018, and the related notes to the financial statements, which collectively comprise the City’s basic financial
statements as listed in the table of contents.
Management’s Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance with accounting
principles generally accepted in the United States of America; this includes the design, implementation, and maintenance of
internal control relevant to the preparation and fair presentation of financial statements that are free from material misstatement,
whether due to fraud or error.
Auditors’ Responsibility
Our responsibility is to express opinions on these financial statements based on our audit. We conducted our audit in accordance
with auditing standards generally accepted in the United States of America and the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require that we
plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.
The procedures selected depend on the auditors’ judgment, including the assessment of the risks of material misstatement of the
financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal control
relevant to the entity’s preparation and fair presentation of the financial statements in order to design audit procedures that are
appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the City’s internal
control. Accordingly, we express no such opinion. An audit also includes evaluating the appropriateness of accounting policies
used and the reasonableness of significant accounting estimates made by management, as well as evaluating the overall financial
statement presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinions.
Opinions
In our opinion, the financial statements referred to above present fairly, in all material respects, the respective financial position
of the governmental activities, the business-type activities, each major fund, and the aggregate remaining fund information of the
City, as of June 30, 2018, and the respective changes in its financial position and, where applicable, cash flows thereof and the
respective budgetary comparison for the General Fund for the year then ended in accordance with accounting principles generally
accepted in the United States of America.
Emphasis of matter
As discussed in Note 6 to the financial statements, the City implemented GASB Statement No. 75, Accounting and Financial
Reporting for Postemployment Benefits Other than Pensions, in 2018. Our opinion is not modified with respect to this matter.
36 2018 AN NUAL R E P O R T
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that Management’s Discussion and Analysis and
the required supplementary information listed in the table of contents be presented to supplement the basic financial statements. Such
information, although not a part of the basic financial statements, is required by the Governmental Accounting Standards Board, who
considers it to be an essential part of the financial reporting for placing the basic financial statements in an appropriate operational,
economic, or historical context. We have applied certain limited procedures to the required supplementary information in accordance
with auditing standards generally accepted in the United States of America, which consist of inquiries of management about the
methods of preparing the information and comparing the information for consistency with management’s responses to our inquiries,
the basic financial statements, and other knowledge we obtained during our audit of the basic financial statements. We do not express
an opinion or provide any assurance on the information because the limited procedures do not provide us with sufficient evidence to
express an opinion or provide any assurance.
Supplementary and Other Information
Our audit was conducted for the purpose of forming opinions on the financial statements that collectively comprise the City’s basic
financial statements. The introductory section, combining and individual fund financial statements, budgetary schedules, other
schedules, and the statistical section, as well as the schedule of expenditures of federal and state awards as required by Title 2 U.S.
Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for
Federal Awards and the State Single Audit Implementation Act, are presented for purposes of additional analysis and are not a
required part of the basic financial statements.
The combining and individual fund financial statements, budgetary schedules, other schedules and the schedule of expenditures of
federal and state awards are the responsibility of management and were derived from and relate directly to the underlying accounting
and other records used to prepare the basic financial statements. Such information has been subjected to the auditing procedures
applied in the audit of the basic financial statements and certain additional procedures, including comparing and reconciling such
information directly to the underlying accounting and other records used to prepare the basic financial statements or to the basic
financial statements themselves, and other additional procedures in accordance with auditing standards generally accepted in the
United States of America. In our opinion, the combining and individual fund statements, budgetary schedules, other schedules and
the schedule of expenditures of federal and state awards are fairly stated, in all material respects, in relation to the basic financial
statements taken as a whole.
The introductory information and the statistical tables have not been subjected to the auditing procedures applied in the audit of the
basic financial statements and, accordingly, we do not express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated October 31, 2018 on our consideration of
the City’s internal control over financial reporting and on our tests of its compliance with certain provisions of laws, regulations,
contracts, and grant agreements and other matters. The purpose of that report is to describe the scope of our testing of internal control
over financial reporting and compliance, and the results of that testing, and not to provide an opinion on internal control over financial
reporting or on compliance. That report is an integral part of an audit performed in accordance with Government Auditing Standards
in considering the City’s internal control over financial reporting and compliance.
High Point, North Carolina
October 31, 2018
W I N S T O N S AL E M , N O R T H C AR O L I N A 37
Management’s Discussion & Analysis
Our discussion of the City of Winston-Salem’s nancial performance is intended as an overview of the City’s nancial
performance for the scal year ended June 30, 2018. The nancial statements and notes included in this report present
the nancial position and operations of the governmental and business activities and duciary responsibilities of the City.
During the scal year, the City continued its sound current and long-range policies for nancial management. These
policies are intended to:
• expand and diversify sources of revenue other than property taxes;
• maintain relatively low-property tax rates;
• facilitate capital improvements by maintaining adequate resources and reasonable nancing capacity;
• augment resources by astute cash management;
• enhance management techniques to improve productivity and e ciency;
• provide self-su cient public services that are similar in operation to private enterprises; and
• continue City-funded a ordable housing initiatives to supplement federal housing programs.
City policies encourage the use of local revenue to provide basic services instead of depending upon uncertain federal
and state sources. We encourage readers to consider the information presented here in conjunction with additional
information furnished in our letter of transmittal.
Financial Highlights
Highlights of the City’s scal year ended June 30, 2018, include:
• City of Winston-Salem total net position increased approximately $41.9 million from $947 million to $989 million.
• At June 30, 2018, total net position of $989 million included $246 million (unrestricted net position), which in large part,
have been reserved for speci c purposes or needed for working capital to meet the City’s ongoing obligations to citizens
and creditors. The unrestricted net position should not be used to fund ongoing operations other than working capital
because major nancial stress would be likely as the assets are depleted.
• At June 30, 2018, the City’s governmental funds reported combined fund balances of $218.6 million. Approximately
11.13% of this amount is unassigned and is available for spending at the government’s discretion.
• Unassigned fund balance of the general fund (approximately $24.7 million) continues to meet working capital
requirements. The City has adopted a nancial policy to maintain a minimum unassigned fund balance of 14% of
estimated expenditures in the general fund. At year-end, unassigned fund balance was 12% of 2019 estimated
expenditures. Due from other funds was $3.7 million because of reimbursements outstanding. These amounts are
reserved in stabilization of state statute in general fund. Legal provisions and nancial policies of the City restrict fund
balances in other funds to the purposes of those funds.
• The City’s total long-term liabilities increased by $104.6 million to $1 billion. Several key factors contributed to this increase:
the issuance of general obligation bonds of $63.8 million and the retirement of $7.6 million in general obligation bonds,
the issuance of $56.3 million in revenue bonds and the retirement of $23.3 million in revenue bonds, the retirement of $3
million in special obligation bonds, and the retirement of $36.8 million in limited obligation bonds. The City entered into
a $25 million equipment lease and received funding from Clean Water State Revolving Loan Fund for $8.5 million. Also,
the City implemented GASB Statement 75 this year. With the new reporting change, the City has a net OPEB liability of
$15.6 million.
• Property taxes supported 52.72% of governmental services to citizens and the community, and 52.99% to be used
for mass transportation in 2018. The City increased the tax rate to $0.5974 for scal year 2018 from $0.585 in scal
year 2017.
• City of Winston-Salem maintained its AAA bond rating from all three major rating agencies.
38 2018 AN NUAL R E P O R T
Overview of Financial Statements
Required Components of Annual Financial Report Figure 1
Management’s Discussion Basic Financial
and Analysis Statements
Government-wide Fund Financial Notes to the
Financial Statements Statements Financial Statements
Summary Detail
Basic Financial Statements
This discussion and analysis serves as an introduction to the City of Winston-Salem’s basic nancial statements, which consist of
three components: 1) government-wide nancial statements, 2) fund nancial statements, and 3) notes to the nancial statements
as shown above. The basic nancial statements present two di erent views of the City through the use of government-wide and
fund nancial statements. In addition to the basic nancial statements, this report contains other supplemental information that
will enhance the reader’s understanding of the nancial condition of the City. This report includes all funds and account groups of
the City of Winston-Salem as well as its component units, which are described below. Note 1A in the nancial report includes
further discussion of the reporting entity and descriptions of funds.
Government-wide Financial Statements
The rst two statements (Exhibits 1 and 2) in the basic nancial statements are the Government-wide Financial Statements. These
nancial statements provide a broad overview of the City’s nancial position and operations, in a manner similar to a private-sector
business. These statements also include two component units, Risk Acceptance Management Corporation and North Carolina
Municipal Leasing Corporation. Although legally separate, nancial information for these nonpro t corporations is blended in the
nancial statements because under federal tax regulations they may provide services only to the City.
The statement of net position presents the City’s assets and deferred out ows of resources and total liabilities and deferred in ows
of resources, with the di erence between the two reported as net position. Over time, increases or decreases in net position may
serve as a useful indicator of whether the nancial position of the City is improving. The statement of activities presents information
on how the City’s net position changed during the most recent scal year. All changes in net position are reported as soon as the
underlying event giving rise to the change occurs, regardless of the timing of related cash ows. Therefore, revenues and expenses
are reported in this statement, which result in cash ows in future scal periods, such as uncollected taxes and earned but unused
vacation leave.
Government-wide statements are divided into governmental and business-type activities. The governmental activities include
most of the City’s basic services such as public safety, parks and recreation, environmental health, transportation, community and
economic development, and general government. Property taxes, intergovernmental revenues, and other local taxes nance
about 80.03% of the costs of these activities. Business-type activities include water and sewer utility, solid waste disposal, stormwater
management, public assembly facilities, parking, and Winston-Salem Transit Authority services. These activities are primarily paid
from charges to customers.
W I N S T O N S AL E M , N O R T H C AR O L I N A 39
Fund Financial Statements
The fund nancial statements (Exhibits 3 through 10) provide a more detailed look at the City’s most signi cant activities.
A fund is used to maintain control over resources that have been segregated for speci c activities or objectives. Fund
accounting ensures and re ects compliance, or non-compliance, with related legal requirements, such as General
Statutes, grantor provisions, or the City’s budget ordinances. The funds of the City are divided into three categories:
governmental funds, proprietary funds, and duciary funds.
Governmental Funds. Governmental funds are used to account for most basic services and are reported as governmental
activities in the government-wide nancial statements. Governmental funds are reported using an accounting method
called modi ed accrual accounting, which provides a short-term spending focus. The relationship between government
activities (reported in the Statement of Net Position and the Statement of Activities) and governmental funds is described
in a reconciliation that is a part of the fund nancial statements.
The City adopts an annual budget for its general fund, certain special revenue funds, debt service fund and capital projects
funds as required by General Statutes. A budgetary comparison statement demonstrating compliance with the budget
ordinance is provided for the general fund in the basic nancial statements.
Proprietary Funds. The City has two di erent kinds of proprietary funds. Enterprise Funds report business-type activities that
are included in the government-wide nancial statements. Enterprise funds are used to account for water and sewer
utilities, solid waste disposal, stormwater management, parking, public transportation, and public assembly facilities
activities. Rate structures of enterprise operations, other than public transportation and public assembly facilities, are set,
insofar as practicable, to recover full operating costs plus depreciation and interest expense and to provide reasonable
working capital and other reserves. Internal Service Funds are an accounting device used to accumulate and allocate costs
internally among the City’s various functions. The City uses internal service funds to account for its central warehouse,
eet services, information services, workers’ compensation, health bene ts, dental and exible bene ts and employee
bene ts funds. These funds predominantly bene t governmental functions and have been included with the respective
governmental activities in the government-wide nancial statements. Risk Acceptance Management Corporation, a
blended component unit, predominantly bene ts business-type activities. It has been included within the business-type
activities in the government-wide nancial statements.
Proprietary fund nancial statements provide more detailed information than that presented in the government-wide
nancial statements and separate information for the water and sewer utility, solid waste disposal and Transit Authority
operations, which are major funds of the City.
Fiduciary Funds. Fiduciary funds are used to account for resources held by the government in a trustee capacity for others.
Because the resources of duciary funds cannot be used to support the government’s own programs, such funds are
speci cally excluded from the government-wide statements. The City uses duciary funds to account for the assets of
post-employment bene ts, which include the Winston-Salem Police O cers’ Retirement and Police O cers’ Separation
Allowance plans, and retired life and health programs.
Other Information. In addition to the basic nancial statements and accompanying notes, this report includes certain
required supplementary information in Exhibits 11 through 21. The purpose of Exhibits 11 through 21 is to provide the
information needed for nancial reporting and accounting of the Winston-Salem Police O cers’ Retirement plan, Police
O cers’ Separation Allowance plan, other Post-employment Bene ts Plans, and the Local Government Employees’
Retirement System plan.
40 2018 AN NUAL R E P O R T
Notes to the Financial Statements
The next section of the basic nancial statements is the notes to the nancial statements, which adds detailed explanations of
some of the data contained in the statements. The notes may provide a better understanding of the information presented in the
government-wide and fund nancial statements.
Government-wide Financial Analysis
The following is a summary of net position for the City of Winston-Salem at June 30, 2018 (as shown in Exhibit 1) with comparative
data for June 30, 2017.
Net Position Figure 2
(dollars in thousands)
Governmental Business-type
Activities Activities Total
2018 2017 2018 2017 2018 2017
Current and other assets $ 265,153 $ 200,022 $ 296,611 $ 238,807 $ 561,764 $ 438,829
Capital assets 477,186 454,810 1,045,785 1,017,740 1,522,971 1,472,550
Total assets 742,339 654,832 1,342,396 1,256,547 2,084,735 1,911,379
Deferred out ows of resources 34,781 36,821 29,753 33,587 64,534 70,408
Long-term liabilities 429,467 354,194 587,876 558,541 1,017,343 912,735
Other liabilities 58,322 52,673 62,827 62,148 121,149 114,821
Total liabilities 487,789 406,867 650,703 620,689 1,138,492 1,027,556
Deferred in ows of resources 12,050 4,184 10,018 3,240 22,068 7,424
Net position:
Net investment in capital assets 166,253 164,416 507,218 483,822 673,471 648,238
Restricted 69,502 65,111 - - 69,502 65,111
Unrestricted 41,526 51,075 204,210 182,383 245,736 233,458
Total net position $ 277,281 $ 280,602 $ 711,428 $ 666,205 $ 988,709 $ 946,807
As indicated above, assets and deferred out ows of resources of the City exceeded liabilities and deferred in ows of resources by
$989 million at June 30, 2018. Analysis of the business-type activities indicates that the capital assets increased $28 million in scal
year 2018 and net position increased $45 million.
A large portion of the City’s net position (68.12%) at June 30, 2018, are net investment in capital assets, which are used to provide
services to citizens. Net investment in capital assets is reported net of the outstanding related debt; however, resources to repay
that debt must be provided in future years from current revenues. Restricted net position, 7% of the City’s net position, represents
resources that are subject to external restrictions, such as the perpetual care fund.
At June 30, 2018, the City is able to report positive balances in all three categories of net position.
Governmental Activities
Net position of governmental activities decreased by $3.3 million. Key elements of this decrease are as follows:
• Property tax revenues are recorded in governmental and business-type activities. During the scal year property tax revenue
increased 5.7%. The 2018 property tax rate was $0.5974, which increased $.0124 from 2017. Current real and personal property tax
collections during scal year 2018 were 99.2% of the current year levy.
• General revenues, other than property taxes, increased $4.1 million. Sales tax increased $2.4 million, which was 6% higher than
2017. Investment income increased $1.5 million, which was 112% higher than 2017.
• Program revenues provided 25.44% of the support for governmental services.
• Total governmental expenses decreased $5.7 million during scal year 2018. A major decrease was seen in the community and
economic development service area, due to an accounting procedure change in 2017 for loan expense.
• Federal and state grants are an important source of supplementary funding for public facilities and programs. During scal year
2018, the City received nearly $29 million in grant revenue for restricted programs or speci c projects and $17.4 million related to
general governmental activities.
W I N S T O N S AL E M , N O R T H C AR O L I N A 41
Business-type Activities
Net position of business-type activities increased by $45.2 million primarily attributable to charges for services. Rate
structures of enterprise operations, other than the Transit Authority and public assembly facilities management, are set,
insofar as practicable, to recover full operating costs plus depreciation and interest expense and to provide a reasonable
working capital and reserve. The parking and public assembly facilities funds are provided an operating subsidy through
a transfer from the general fund. The Transit Authority is provided operating support from the 4.98 cents collected in
property taxes to be used for mass transportation.
Business-type Activities
June 30, 2018 Figure 3
(dollars in thousands)
Operating Increase
Expenses Nonoperating (Decrease)
Operating Before Depreciation Revenues Capital Transfers Net
Revenues Depreciation Expense (Expenses) Contributions In (Out) Position
Water and sewer utility $ 109,227 $ 43,226 $ 26,940 $ (7,811) $ 9,677 $ (433) $ 40,494
Solid waste disposal 11,472 7,650 4,314 2,985 - 543 3,036
Stormwater management 10,939 5,765 907 902 97 (1,993) 3,273
Parking 827 951 448 316 (39) 495 200
Transit Authority 2,069 16,744 2,947 15,833 474 (13) (1,328)
Public assembly facilities
management 6,145 5,937 1,915 (1,039) - 3,109 363
Risk Acceptance
Management Corp. 1,066 3,352 - 4,954 - - 2,668
Total $141,745 $ 83,625 $ 37,471 $ 16,140 $ 10,209 $ 1,708 $ 48,706
Financial Analysis of the City’s Funds
As noted earlier, fund accounting enables the City to ensure and demonstrate compliance with nance-related legal
requirements.
Governmental Funds. The focus of the City’s governmental funds is to provide information on near-term in ows, out ows,
and balances of usable resources. Such information is useful in assessing the City’s nancing requirements.
The general fund is the chief operating fund of the City. At the end of the current scal year, total fund balance of the
general fund was approximately $50.2 million of which $24.7 million was unassigned. As a measure of the general fund’s
liquidity, it may be useful to compare both the total and unassigned fund balance. Unassigned fund balance represents
11.95% of the scal year 2018 budgeted expenditures, while total fund balance represents approximately 24.29%. The
fund balance of the general fund increased $627 thousand during the scal year.
42 2018 AN NUAL R E P O R T
Figure 4 presents the changes in net position of the City of Winston-Salem.
Changes in Net Position Figure 4
(dollars in thousands)
Governmental Activities Business-type Activities Total
2018 2017 2018 2017 2018 2017
Revenues:
Program revenues:
Charges for services $ 38,375 $ 38,113 $ 141,745 $ 135,426 $ 180,120 $ 173,539
Operating grants and contributions 17,446 18,329 11,684 8,795 29,130 27,124
Capital grants and contributions 2,753 3,409 10,209 5,899 12,962 9,308
General revenues:
Property taxes 121,373 114,868 10,435 7,177 131,808 122,045
Sales taxes 42,371 39,984 - - 42,371 39,984
Other local taxes 1,183 1,151 - - 1,183 1,151
Telecommunications sales tax 1,916 2,112 - - 1,916 2,112
Utilities sales tax 13,329 13,131 - - 13,329 13,131
Piped natural gas sales tax 862 673 - - 862 673
Video programming tax 2,170 2,224 - - 2,170 2,224
Local tax reimbursements 1,042 1,081 - - 1,042 1,081
Investment income 2,901 1,370 14,479 16,941 17,380 18,311
Other 1,839 1,796 - - 1,839 1,796
Total revenues 247,560 238,241 188,552 174,238 436,112 412,479
Expenses:
General government 32,346 32,646 - - 32,346 32,646
Public protection 108,273 106,740 - - 108,273 106,740
Environmental health 19,667 17,720 - - 19,667 17,720
Transportation 19,935 20,545 - - 19,935 20,545
Culture and recreation 13,192 12,069 - - 13,192 12,069
Community & economic development 23,994 36,065 - - 23,994 36,065
Interest and scal charges 12,828 10,191 - - 12,828 10,191
Water and sewer utility - - 88,763 87,582 88,763 87,582
Solid waste disposal - - 12,159 13,580 12,159 13,580
Stormwater management - - 7,112 11,675 7,112 11,675
Parking - - 1,537 1,647 1,537 1,647
Transit Authority - - 19,691 18,891 19,691 18,891
Public assembly facilities management - - 8,940 7,762 8,940 7,762
Risk Acceptance Management Corp. - - 3,352 2,628 3,352 2,628
Total expenses 230,235 235,976 141,554 143,765 371,789 379,741
Increase in net position before transfers 17,325 2,265 46,998 30,473 64,323 32,738
Transfers
Government-wide (1,708) 771 1,708 (771) - -
Increase (decrease) in net position 15,617 3,036 48,706 29,702 64,323 32,738
Net position – beginning,
as previously stated 280,602 305,810 666,205 636,503 946,807 942,313
Cumulative e ect adjustment (18,938) (28,244) (3,483) - (22,421) (28,244)
Total net position – beginning, as adjusted 261,664 277,566 662,722 636,503 924,386 914,069
Net position – ending $ 277,281 $ 280,602 $ 711,428 $ 666,205 $ 988,709 $ 946,807
The debt service fund has a fund balance of $25 million at June 30, 2018, an increase of $1.3 million, all of which is restricted for
payment of debt service.
The fund balance of the capital projects fund increased $60.6 million, to $90.9 million at June 30, 2018, all of which is appropriated
for capital projects.
W I N S T O N S AL E M , N O R T H C AR O L I N A 43
General Fund Budgetary Highlights. Di erences between the original budget and the nal amended budget resulted in
appropriations increasing $3.8 million during scal year 2018. Expenditure budgets were increased $2.1 million for carry
over encumbrances. Major budget amendments included an additional $400 thousand for City street maintenance,
$100,000 for capital projects at Smith Reynolds Airport a community and economic development project, $442 thousand
to the public safety area to fund personnel, equipment and training, and a transfer to the grants fund for a local match for
the re department, $789 thousand to the public safety area for police and re pay adjustments.
General fund revenues recognized positive budget variances during 2017-2018. The City’s general fund budget had a
favorable expenditure variance of $4.4 million.
Proprietary Funds. The City’s proprietary fund nancial statements provide the same type of information as that provided
in the government-wide nancial statements, but in more detail. The major enterprise funds are the water and sewer
utility, solid waste disposal and Transit Authority funds.
Net position of the water and sewer utility, solid waste disposal and Transit Authority funds were $500 million, $48 million
and $29 million at June 30, 2018, respectively. The net position of the water and sewer fund increased $37.9 million
primarily due to charges for services and capital contributions. The water and sewer fund adopted a 4% increase in the
water volumetric rate, a 6% increase in the sewer volumetric rate, and a $1.64/month increase for water and sewer base
charges for residential customers in October 2017.
Capital Asset and Debt Administration
Capital Assets. The City’s investment in capital assets for its governmental and business-type activities as of June 30, 2018,
totals $1.5 billion (net of accumulated depreciation). These assets include land, buildings, improvements other than
buildings (infrastructure assets, such as streets, sidewalks, water and sewer lines), machinery and equipment, and
construction-in-progress.
Capital Assets (net of depreciation)
June 30, 2018 with Comparative Data for June 30, 2017 Figure 5
(dollars in thousands)
Governmental Activities Business-type Activities Total
2018 2017 2018 2017 2018 2017
Land $ 79,350 $ 76,893 $ 44,346 $ 44,117 $ 123,696 $ 121,010
Buildings 73,998 70,381 193,269 199,758 267,267 270,139
Improvements other than
buildings 145,532 132,694 595,873 556,517 741,405 689,211
Machinery and equipment 34,359 34,567 26,280 27,016 60,639 61,583
Construction in progress 143,947 140,275 186,017 190,332 329,964 330,607
Total $ 477,186 $ 454,810 $ 1,045,785 $ 1,017,740 $ 1,522,971 $ 1,472,550
44 2018 AN NUAL R E P O R T
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